Consumer complaint received 2020-07-28
Product: Mortgage — Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: Rocket Mortgage, LLC (TX)

This letter is a follow up on our mortgage conversation with XXXX XXXX from Quicken Loans on XX/XX/XXXX about a problem we are having with our mortgage refinance which closed on XX/XX/XXXX. 

We are dissatisfied with Quickens service because a XXXX XXXX Payoff was done without adequate notification and approval by all borrowers. We discovered this because we reached out to our Loan Officer XXXX XXXX on XX/XX/XXXX to find out why we received an email advising we would receive a check for {$420.00} and XXXX, not knowing forwarded the email to Client Relations. We knew our escrow account had approximately {$4500.00} and had plans to use these funds for home improvements so we knew something was wrong. On XX/XX/XXXX XXXX XXXX responded stating they could direct deposit escrow funds. This response made no sense because we fully expected our escrow to be refunded to us after closing since a new escrow account was created and these funds can not be commingled. I believe there was also a short conversation on XX/XX/XXXX with XXXX where I confirmed we would receive our escrow funds back after closing. Upon calling and speaking to a Client Relations representative on XX/XX/XXXX we were even more confused only being told the amount was correct, that was all we would receive back because we agreed to this in writing and it was on our payoff. As an informed borrower I had no idea what was happening and was in tears. When asking where this was agreed to, I was told Client Relations did not have the answer and our concern would be sent to Executive Resolutions when they reopened as they were already closed at XXXX CST for the holiday weekend. We were able to reach another Loan XXXX XXXX XXXX on XX/XX/XXXX and he was able to explain Quickens common practice is to do what is called a Netted Escrow Payoff, while I heard what he was saying I did not fully understand until I Goggled the term finding an article from Quicken Loans website : https : //www.quickenloans.com/blog/mortgage-net-escrow dated XX/XX/XXXX. It contained a chart which I was able to follow with my knowledge of Real Estate to finally understand the term and the article stated Quicken Loans does not do Netting Escrow. 

This exert from Quickens website is strongly worded stating : Ignorance is bliss is horribly misrepresented, not to mention a poor mantra to live by, and is certainly no way to act toward major financial decisions. There are many things in the mortgage process that get so complicated and seemingly convoluted it seems so much easier to just throw things in the wind and hope they work out. This isnt the case, and you know it! Thats why on this weeks Know Your Mortgage we have decided to look into an issue thats very important when it comes to refinancing your mortgage with the current servicer you already have : Netting Escrow. It goes on to say not all mortgage companies do ( Quicken Loans does not ). And, also states Youve been pulled up from the world of obliviousness and left with a solid understanding of a complex topic. Thus, the process Quicken has established of having one borrower check a box without signature consent of both borrowers and a verbal conversation by the Loan Officer is quite concerning on what Quicken has recognized as a complex topic. 

On XXXX we received a call from XXXX XXXX whose title is Executive Advocate. She confirmed what happened was a Netted Escrow Payoff. I told her as an informed borrower I had never heard of this and neither had a few of my colleagues working for other large banks and that I had read all the application and closing documents and this was not in the documents. I was quite upset over the extended holiday weekend because I thought I missed something. XXXX advised I did not miss anything because the other borrower had checked a box, signature not required, apparently agreeing to this. I can not fault the other borrower for this because he trusted Quicken ( this is our 3rd mortgage with Quicken since XXXX, 1st refinance ) and didnt have enough knowledge to know what this meant and thought I would receive the same action. In fact, there was no way for me to know he did this and correct because there was no record for me to view his action on my to do list or documentation on any disclosures. We also inquired as to why the whole escrow account was not taken to understand why we would be receiving {$420.00} and were advised there are calculations the payoff dept does to determine how much should be taken, no specifics. XXXX stated nothing else could be done to correct the situation. I asked if she had heard other borrowers upset about this same situation before and was shocked to be advised she does hear this often from borrowers and that our concerns would be shared in the event that Quicken decides to revisit this practice. We can not in good conscience accept this response. We have trusted Quicken Loans with our familys largest financial transactions and to know this is a known issue for Quicken Loans and nothing is being done to remedy the situation is very disheartening. 

We are writing to formally request that a Netted Escrow Payoff be reversed on our mortgage as all borrowers were not properly notified and did not agree to this practice in writing with an e signature or wet signature on a written disclosure. We realize this will increase our loan amount and thus our monthly mortgage payment by {$11.00} per month and is in the best interest of our family. Furthermore, this topic should have been discussed while we were in the decision process prior to agreeing to go with Quicken Loans, doing our due diligence to be informed borrowers comparing Loan Estimates from Credit Human to Quicken with XXXX XXXX or during the application process with XXXX XXXX. While Quicken Loans was initially significantly higher in points for the same term and loan amount XXXX was able to provide a competitive option so we could consider remaining with XXXX. In reviewing the Loan Estimates from the 2 companies we confirmed with XXXX the only difference was Quicken was {$19.00} per month higher for the interest rate of 2.99 % vs Credit Humans 2.89 %. The payoffs on the 2 Loan Estimates showed a difference of {$670.00} and the loan amounts differed slightly depending on the approximate amount due from borrower. Overall, by refinancing with either bank we would save over {$100000.00} over the course of the mortgage. Thus, we opted to remain with Quicken because of the relationship and expertise we have received with XXXX. Had we known at that time Quicken Loans practice is to do a Netted Escrow Payoff we would have asked if we would be able to opt out or would have gone with Credit Human to receive our escrow funds back, so this very much appears to be a bait and switch situation. We understand mistakes can happen which is why we asked XXXX XXXX to assist with making the problem right. Netted Escrow Payoff should be discussed verbally on each loan in the same way a borrower can opt to/opt out of escrowing taxes and insurance and this appears to be commingling funds which is not allowed. 

Also, it should be noted we were not asked any HDMA Demographic information questions during the process. Nor did we receive a Loan Estimate for our initial application call in mid XXXX in which XXXX XXXX called to follow up with us and asked for a Loan Estimate from the other bank we were considering using to see if Quicken could compete despite our several requests via phone and email.