Consumer complaint received 2018-08-11
Product: Mortgage — FHA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: TCF FINANCIAL CORPORATION (MI)

XXXX XXXX MORTGAGE Pre-qualification by an inexperienced lender can cost you hundreds or thousands! 
I am a new home buyer. I have never applied for a mortgage and did not know that you should not trust the person you are working with to know their job. On XX/XX/XXXX I submitted my first online mortgage application to XXXX XXXX. I had been referred by a co-worker to ask for XXXX XXXX because she was really helpful with her in the preliminary process and was able to get her approved in spite of credit issues. On XX/XX/XXXX I was contacted by XXXX XXXX of XXXX XXXX in XXXX, MI. She asked if she had my permission to run my full credit report. I gave her consent and the process began. I had worked hard over the course of 2 years to repair my credit that had plummeted due to some personal issues and I knew I still had a little ways to go, but thought it would be worth the time to get feedback from a lender on what I could do. I have also participated in two home buyer education courses and reviewed all of my credit a full year before applying. On XX/XX/XXXX XXXX sent me an email letting me know what my credit score had  come in at. It was almost 50 points lower than what the credit monitoring site I had been using regularly reported. So I asked about that and XXXX told me that she seen some derogatory marks but that FHA considers other factors. She said that she would like to get all of my information and submit my file to underwriting prior to me finding a home to get me fully approved. I liked that idea as I had not begun a home search yet. She told me in email that once she submits it to underwriting she will have an answer in XXXX hours. On XX/XX/XXXX I submitted all of the required documents for XXXX to review. On XX/XX/XXXX I received a pre-qualification letter from XXXX stating that she had me approved for XXXX FHA. She then asked me if I had a buyer 's agent or if I was contacting the listing agent. I had planned to contact the listing agent of a home I was interested in and XXXX told me that it is always better to have a buyer 's agent. She gave me the name of XXXX of XXXX XXXX and a phone number to call her. In the same email communication I told XXXX that I wasn't ready to start looking for a home yet and asked how long the pre-qualification was good for. She told me I had 90 days and that there was no major rush. On XX/XX/XXXX XXXX again reached out to me via email and asked me how it was going with the home search and to see if I had decided on using a buyer 's agent or listing agent. I told her I would give the person a call that she had recommended. I was super excited to think that there would not be any issues with financing a home as long as I stayed well under the XXXX to ensure I had the down payment needed and could afford the mortgage without struggling. The fact that XXXX had told me she was submitting my file to underwriting and then gave me a letter and the name of a realtor led me to believe that she had reviewed my credit history, underwriting had no concerns with it, and made me feel confident in starting my home search. I called XXXX, I signed a realtor attainment form with her and together we found a home priced at XXXX. I submitted a purchase agreement and good faith deposit of XXXX on XX/XX/XXXX and it was accepted. I had taken my XXXX children to this home, the first home that they would ever live in, and had them feeling hopeful. On XX/XX/XXXX I paid XXXX for a Home Inspection. The Inspector required a furnace inspection. The furnace inspection costed XXXX and was paid on XX/XX/XXXX. I then met with XXXX in her XXXX office and reviewed my credit history and had to provide details on the derogatory marks before submitting it to underwriting for final approval and to set up  closing. On XX/XX/XXXX I received an email from XXXX letting me know that my application was denied due to derogatory credit history. She suggested that I pay off some of the non-medical collections and offered to give me some phone numbers. I want to help spread the word that this is real, families get their hopes up and dream of home ownership but not all mortgage lenders are knowledgeable in reading credit and being honest about concerns in the beginning. Had she told me that I should work on paying off the negative outstanding derogatory marks in the beginning I could have saved the money from the home and furnace inspection and used it to pay off two of them. I also find it difficult to believe that if she submitted my file to underwriting prior to my home search that they wouldn't have identified concerns early on. I feel like she was dishonest about her knowledge and she was not being supervised. I also wouldn't have XXXX heart broken children. I would recommend to anyone, don't go to XXXX XXXX for a Mortgage. A similar situation happened to a co-worker that had also gone through XXXX around the same time as myself. She unfortunately lost out on more money than I did. XXXX also referred her to XXXX as well. Do your research and find someone that has been in the business a long time, or if they are newer, have a very hands on supervisor overseeing everything.