Consumer complaint received 2021-07-23
Product: Mortgage — VA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: SUN WEST MORTGAGE COMPANY, INC. (CO)

Background We closed on our house on XX/XX/2020. Within a month the pandemic hit and I was laid off from my job as a direct result of COVID-19-related hardship for the company. Since even the supplemented unemployment insurance payments were nowhere near my regular salary ( on which we qualified for the house ) we were in danger of instantly losing our home. We were able to be placed on COVID-19 emergency forbearance through our current lender ( XXXX ). This was extended once as I struggled to find a job in the poor economy. In XXXX I was able to obtain work, but at a significantly reduced salary than I was making before the pandemic. Still, we were able to come out of the forbearance and modify the mortgage to roll in the missed payments. We entered the trial period of the modification with our first payment on XX/XX/2020, with subsequent trial payments in XXXX and XXXX. Regular mortgage payments on the modification began in XXXX and we have paid every month since until XXXX XXXX 3 months of trial, 4 months of regular payments ). 

Current Issue We have been working with XXXX  on an IRRRL refinance through SunWest Mortgage Company since early XXXX. We were turned onto them by the copious mailers that they sent offering lower rates and the ability to skip two payments. This was appealing to us since, like many, we are still struggling to catch up from the difficulties we faced during the worst economic impacts of the pandemic and their continuing impacts now. XXXX prequalified us for a lowered interest rate and advised us specifically that we would not need to pay XXXX or XXXX payments. Because we were so far along in the process ( we had signed initial disclosures, some additional VA-specific disclosures, a Loan Estimate, and a Change of Circumstances form ) and were just waiting on the final formalities as we understood, we did not pay the XXXX payment to our current lender. 

On XX/XX/XXXX, we were informed that a VA underwriting requirement precludes us from qualifying because we have not made 6 payments on the modification. Upon reviewing the VA Circular that outlines this guidance, we found that it was rescinded XX/XX/XXXX of this year and have been unable to locate guidance that replaces this. We have, in fact, made 7 payments post-modification ( three were in the trial period ). We are being instructed to make three additional payments ( XXXX, XXXX, and XXXX ) and to then resume this process with XXXX. 

As a result of practices that are specifically called out as problematic by the VA and which we unfortunately discovered warnings about post hoc, ( XXXX XXXX XXXX  ) we are now in a position of ( 1 ) being within days of being 30 days late on our XXXX payment, ( 2 ) having our XXXX payment simultaneously due, ( 3 ) being unable to handle two simultaneous payments due to the fact that we spent our XXXX payment on necessities that we had been forgoing due to our newly reduced financial capacity, ( 4 ) getting into a situation where out already stretched credit falls into a rolling 90-day late cycle indefinitely, ( 5 ) owing monthly late fees, being subject to constant debt collection activities, falling into poor standing with our current lender, and ( 6 ) possibly losing our home because of an accumulation of the above difficulties on top of our current hardship and any future hardship caused by impending COVID-19 variants.

My husband served his country and he deserves better than to live in fear that our family will lose our home and be unable to afford another one due to the current difficulties in the housing market. I appreciate the mission of the CFPB and I hope that you are able to help us. Thank you.