Consumer complaint received 2022-09-26
Product: Mortgage — Other type of mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: FIRST NATIONAL BANK OF PENNSYLVANIA (NC)

I am writing CFPB because I need assistance with a devastating situation with XXXX XXXXXXXX XXXX  ( XXXX ) which resulted in a considerable loss of funds, including my XXXX money deposit ( XXXX ), increased mortgage payment and temporary housing costs to name a few. It also caused stress and XXXX which I can not put a price on. 

On XX/XX/XXXX, I contacted XXXX XXXX XXXX XXXX XXXX, XXXX XXXX Consultant at XXXX ( XXXX ID : XXXX ) to receive a prequalification for a home we were interested in purchasing. I informed XXXX that we had {$100000.00} cash towards the deposit. On the same day, XXXX informed me that the best product XXXX could offer was for a 90 % loan. I completed the online application and received a prequalification letter for a Jumbo Portfolio Fixed Rate Loan with an interest rate of XXXX XXXX I was shocked and delighted to receive a XXXX XXXX  interest rate which was unheard of at the time. I contacted my preferred lender at XXXX XXXX who informed that I had an excellent rate that he could not match. He was shocked the bank could offer such a low rate. The prequalification letter was for a purchase price of {$930000.00}, loan amount of XXXX, down payment of {$98000.00} and estimated monthly payment of {$4900.00}. Later I received a loan estimate with a monthly payment estimated at {$5000.00} On XX/XX/XXXX, I informed XXXX that I was waiting on the executed contract from the seller and continued to upload documents. On XX/XX/XXXX, XXXX informed me that XXXX had to disclose today, and he needed the sales contract. I was advised to upload the contract I submitted in lieu of a ratified one. On XX/XX/XXXX, I uploaded the executed sales contract to XXXX client portal. 

REQUEST TO COMPLETE AN AMENDED TAX RETURN On XX/XX/XXXX, XXXX informed me that, after reviewing my tax documents, he noticed XXXX of my investment properties did not appear on my XXXX tax return but was on my XXXX tax return. XXXX advised me to complete an amended return so the income, which amounted to about {$25000.00}, could be counted towards my debt-to-income ratio. I was shocked by my XXXX XXXX  egregious error as I have worked with him for XXXX years. I received several emails and phone calls from XXXX regarding the status of the amended returns. The first was on XX/XX/XXXX, where XXXX states he would need a copy of the amended tax returns as well as confirmation from the IRS that the file was received. 

On XX/XX/XXXX, XXXX reached out again to check on the status of the amended tax return stating, I know the underwriter is going to ask about it. Later that day, XXXX sent an email stating, So the underwriter is giving us 72 hours to fix the issues, first the lack of rent on the investment property ( my tenant of XXXX XXXX  was in the process of renewing their lease at a higher rent rate which XXXX was aware of ), second the status of the existing home ( I asked XXXX if we could qualify if we leased vs sold our home which he said we could lease the home if we could provide a XXXX lease ) and third the status of whatever the tax person is getting done. I informed XXXX that I was on the phone with my XXXX when he responded on XX/XX/XXXX, stating please let me know asap on the current home being rented, I am concerned we have waited too long to get the tax issue resolved, with the current tax ratios are over 50 %. I believe the ratios were 51-55 % at that time. I was also informed via phone that I would also have to pay the past due taxes before my loan would be approved. I asked why I was just now receiving this information. XXXX stated he was providing updates as he received them from underwriting. I called XXXX to inform him that his calls/emails about the amended tax returns were causing me stress. It took 4-5 days to get the amended returns. I had 5-6 calls/emails regarding the amended returns, some with XXXX panicking. I advised XXXX that his stress caused me to stress and asked him not to call me with panic but with solutions. On XX/XX/XXXX, t I uploaded the amended returns to the client portal. I then asked XXXX how long it would take to receive the loan approval. On XX/XX/XXXX, XXXX responded, it should just take a couple of days. 
On XX/XX/XXXX, I receive an email from XXXX titled, XXXX XXXX. The subject read, Hi the head of underwriting just called me and said we cant accept an amended return to qualify. Please call. I was in complete shock! XXXX did not offer any solutions which was disappointing. I then offered a few solutions : 1. I reminded XXXX about my new job offer and asked if I could qualify with the new salary 2. I asked if the seller/developer lowered the price of the home could I qualify and asked the amount I would qualify for 3. I asked if my fianc could be added to the loan as we live together. I also asked XXXX why underwriting asked for the amended tax return on multiple occasions if I they would not accept them. I did not receive a response. 
On XX/XX/XXXX, I shared the offer later prior to negotiations. XXXX informed me that the salary, plus a lease of {$3100.00} on our current home and a reduction of {$50000.00} on the loan would allow me to qualify. 

XXXX XXXX I contacted XXXX  manager who was dismissive. As a result, I contacted the regional VP XXXX XXXX XXXX on XX/XX/XXXX and shared my story. He informed me that XXXX does not accept amended returns to qualify a loan. He further stated that no bank does. The reason being if the customer does not get approved, the bank could be liable for paying the customers IRS bill as they advised them to submit the amended return to qualify. He asked for all the documentation and said he would research my situation. 

On XX/XX/XXXX, my fianc started an application. He was told that his mortgage lates ( XXXX ) which were a result of his divorce, would not put in a position to help us qualify for a loan. He and I have similar salaries and somewhat similar credit scores. This was surprising as he was approved for a conventional loan. In all fairness, I was told by a different loan XXXX that jumbo loans are harder to get approved. 

On XX/XX/XXXX, I informed XXXX that we were going to receive an application for the full lease amount of {$3300.00} for our current residence. I later asked for a new ratio calculation. I then shared my executed job offer with XXXX XXXX. On XX/XX/XXXX XXXX XXXX congratulated me on the offer and said he needed to contact XXXX to determine what the new ratios would be at the higher base salary. Once I have that information, I can request a ratio exception. Let me connect with XXXX and we will advise no later than XXXX. 

At some point ( I believe it was on XXXX ), I was told that I needed to supply my XXXX tax return to show the rental income for my investment property on my schedule E. Yet another new ask. When I asked about the ratio exception, XXXX XXXX stated he never committed to that even though I have it in writing. He also asked me to show rents received from my investment property. I forward my tenants rental payment history on XXXX from XX/XX/XXXX XX/XX/XXXX. I assume the new lease was not enough and that implied that I was being dishonest. I informed XXXX that I had reached out to my XXXX  but wondered why the requirements had changed again. XXXX XXXX also informed me that the rental income from our current residence would not be considered in the qualification process as there is no rental history. Again, this was my first time hearing this! I asked XXXX about this on XX/XX/XXXX. His response, This was presented to me yesterday saying that underwriting would not accept a lease on the departure residence. I again asked why I was receiving this information on XX/XX/XXXX when I am scheduled to close on XX/XX/XXXX. XXXX  response was, That is when I thought there would be an exception for the lease. I also again asked why underwriting would not take the amended returns they requested. XXXXXXXX response was, I assumed they would accept it. 

LOSS SUMMARY Several assumptions were made that resulted in loan denial. If I had received the correct information sooner, the {$5000.00} XXXX could have been refunded. We also approved a rental application on XX/XX/XXXX as we did not want to put the family in a same situation we were in. We found a new construction home which is $ XXXX less than the previous home and sourced temporary housing until that home is complete. It will cost us {$1000.00} per month ( we hope to only be there 2 months ) and {$200.00} a month for our pod. Our new loan will be at an interest rate of XXXX %, raising our payment by {$880.00} a month or {$10000.00} for the first year and {$21000.00} for the second year until rates decline and we can refinance. This is not a small amount of money!!! It is providing an unnecessary financial hardship on our family!!! Our children were devastated when we broke the news to them. Furthermore, I was berated by the sellers agent who is also a managing partner for the development. We paid {$5000.00} in due diligence fees which I understand is non-refundable, Federal taxes of {$5800.00} and State taxest ( I need to confirm the amount with the XXXX as I dont have an invoice yet but I estimate its under {$2000.00} ). 

APPRAISAL On XX/XX/XXXX, I received the appraisal which was at the amount of the purchase price. I had previously asked if the XXXX would go to the value of the home or would they stop at the loan amount. Later that day, XXXX informed me he was a little uncomfortable with their ( the appraisers ) first comp coming in at {$840000.00} as the contract was from XXXX XXXX  XXXX, the XXXX should have done a time value adjustment. I asked if we should challenge the appraisal because they did not do the time value adjustment. XXXX informed me that he needed, the review XXXX to review it, I sent him a message questioning the lack of time adjustments. I thanked XXXX because I wanted to know the true value of the home. I asked XXXX XXXX about the time value adjustment. He was not aware of the term. 

I have email correspondence between myself and XXXX that I can share. Note that these examples do not reflect the many emails and phone calls that I had with XXXX. During this time, I was extremely stressed which caused me to become XXXX. The seller/developer accused me of having buyer 's remorse and was extremely unpleasant during the process as I detailed the situation with XXXX and kindly asked that they consider refunding our XXXX money deposit. What is especially disheartening is that I did not receive further communication from the XXXX team. Simply a link to download the loan denial which referenced they would not accept an amended return. I do hope that you review our situation with empathy. Our hope is to recoup funds loss during this devastating process. Again, you can not place a dollar amount on the stress our family endured. I just hope no other family has a similar process.