Consumer complaint received 2019-09-03
Product: Mortgage — Other type of mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: Movement Mortgage LLC (CA)

My wife and I have suffered economic damages as a result of a fraudulent preapproval letter for a loan that we found out later was never a viable option. It was drafted by XXXX XXXX at Movement Mortgage, XXXX XXXX XXXX, XXXX XXXX XXXX, XXXX XXXX, CA XXXX ( phone : XXXX ). Movement Mortgage also has corporate offices at XXXX XXXX XXXX XXXX, XXXX XXXX, SC XXXX ( phone : XXXX ). The preapproval letter given to us inXX/XX/2019 stated that were qualified for a loan of {$610000.00} on a purchase price of {$760000.00}, or a 20 % down payment, which was to be valid until XX/XX/2019. The loan officer had full access to our credit report history, income history, and asset information through an online online application. Therefore, there was full transparency of our financial history for him to use prior to issuing the preapproval letter. 
We fully relied on this preapproval letter, to our financial detriment, as we used it as a basis for selling our home as well as determining the purchase price amount and down payment funds needed for buying our new home. We put our home on the market at the end of XXXX after getting this preapproval letter ; once we had a buyer for our home, we made a contingent offer on a new home based upon the amounts stated in the preapproval letter. Once our home was sold and we had the 20 % down we were told was needed, with 8 days before closing, XXXX XXXX told us that we now needed to come up with 25 % down to get the loan. We then had to borrow money from a relative and ask for an extension to meet the new loan requirements. All of a sudden, Mr. XXXX informed us that he could not find any lenders who could do a 25 % down loan and that our only option was to get a hard money loan which would cost more in points and fees. He stated he could get us into the hard money loan and that we could subsequently refinance because it had no prepay penalty. 
He then sent the loan out to a XXXX XXXX at XXXX XXXX, who took the information to apply for a loan with XXXX XXXX. We got all the documents and information needed and less than 48 hours before the third extension on escrow was set to expire, a notary came to our door with loan documents to sign. The loan docs stated in 6 different places that the property was not to be owner-occupied, had a 8.9 % interest rate, and would cost about {$40000.00} in fees, and that if we did in fact occupy the property, it could be foreclosed upon in 24 hours due to a violation of contract. Obviously, we could not sign this, as the whole intent of the purchase was to purchase a new home for our family that we could actually live in ourselves. He knew when he first met with us in XX/XX/2019 that were looking for a new home for our family, so he encouraged us to lie on the loan documents. If we knew that this was a fraudulent preapproval letter and a bait and switch, we would never have sold our home when we did, as now we are out of a home. 
Due to Mr. XXXX 's professional negligence and misrepresentations, we incurred significant monetary damages and lost our home. To date, we have incurred a total of {$65000.00} in monetary damages : - Appraisal and Home Inspection fees : {$980.00} - Loss of Equity on the sale of our home : {$12000.00} - Loss of equity on the new home purchase : {$37000.00} - 35 hours of our time @ $ XXXX/hr fulfilling requests by Mr. XXXX : {$10000.00} - Rental costs : {$3400.00} - Moving Expense : {$900.00} - Storage fees : {$1200.00} - Legal Fees : {$390.00} Under California Law, a  lender is liable for the negligence and misrepresentations of its loan officers, even absent any contractual privity between borrower and lender. As a mortgage professional, Mr. XXXX had a duty to us to put our interests ahead of his own and to deal honestly and fairly. Instead of fulfilling this duty, he misled us with a bait and switch so that he could receive even more in commissions and fees.