Consumer complaint received 2020-03-27
Product: Mortgage — Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: LD Holdings Group, LLC (CA)

This company is harming consumers by engaging in fraudulent business practices, causing consumers seeking a mortgage refinance to not only expend considerable time and energy to move through the loan application process, but also a consumer having to suffer financial losses due to lost opportunity as interest rates and closing costs move rapidly in a volatile market. LoanDepot is a non-bank mortgage lender, and I am very concerned that this unregulated entity is taking advantage of vulnerable consumers. While there are plenty of reputable businesses occupying this space, like XXXX XXXX, LoanDepot and others that operate like them are employing deceptive business practices. I wanted to bring this to the CFPB 's attention for regulatory action. 

My husband and I opened a loan application with Loandepot.com LLC ( " LoanDepot '' ) on XX/XX/XXXX. In discussions with the agent various times over the phone about interest rates and closing costs, we executed a loan agreement with them -- as we believed -- locking a 15 year fixed mortgage refinance loan with 2.62 % interest rate. The loan summary ( see Attachment 1 ) contained all the terms. The Lock Agreement they  presented to us, and which we executed on the same date of XX/XX/XXXX, indicated we had not decided to lock in an interest rate. We questioned why it said that even though we had agreed on a lock-in rate already per the loan summary. The agent assured us that it was locked and we proceeded with the application process providing all of the requested documents verifying income, credit report, and even underwent an appraisal of our property on XX/XX/XXXX for which we were assessed a {$500.00} appraisal fee. The borrower 's dashboard which we could log into and check the status of our application also indicated our rate as 2.62 % and a lock in rate date of XX/XX/XXXX. Which borrower would undergo an appraisal and pay the fee if we didn't already believe in good faith based on assurances from the lender that we had locked in the rate and terms? 

On XX/XX/XXXX, we received a call from XXXX XXXX at LoanDepot advising they had to terminate our application because we were in a " shelter-in-place '' zone so they are unable to complete the application due to recording office closures, etc. We found this perplexing since our county recorder 's office was not closed and asked them to provide us with a written explanation setting out the exact reasons. We did not receive a written explanation. 

On XX/XX/XXXX, I drafted an email to XXXX XXXX asking for more information and requesting that they continue with our application ( see Attachment 2 ). After receiving no written reply, my husband contacted the agent we've been working with for an answer as to why our application was canceled and he received the written email on XX/XX/XXXX from LoanDepot 's management that it was being cancelled because the " loan is in a shelter in place zone and is unable to proceed '' ( see Attachment 3 ). My husband then called our agent XXXX and asked for written confirmation that ALL applicants in a shelter-in-place zone were having their applications cancelled and we were not targeted for any prohibited reasons. We suspected we were targeted for loan cancellation because we had initiated our application at a good time and secured a very low rate with low closing costs. Shortly after our lock-in, rates and fees significantly moved up because the market was being flooded with refinance applications such that it was not as profitable for LoanDepot to continue to work our application when they can collect higher fees and costs with other applicants. 

Despite being told twice the same reason that our loan was cancelled due to being in a shelter in place zone which made it impossible to proceed with our agreement, we received in the mail that our loan application is being denied due to adverse information provided in our consumer credit reports. This was clearly a falsified reason because they can not attest to a fair process to terminating all applications in shelter-in-place zones ( practically the whole country is in, or soon to be in, shelter-in-place zones ).

I believe LoanDepot employs fraudulent business practices and should incur a large fine, made to correct their fraudulent business practices or shut down. Their Lock Agreement is deliberately fraudulent in imposing in writing that the borrower has not locked in their rate when all verbal assurances and other written documents ( loan summa
ry ) and borrower dashboard gives the borrower the false assurance that they have locked in all the rates and terms. They would then intentionally point to the Lock Agreement when challenged that this never occurred. I would like to further note that up until XX/XX/XXXX, the borrower dashboard showed our fixed rate of 2.62 % and lock-in period of XXXX. However, after my written email of complaint to XXXX XXXX, the dashboard was updated to show " NA '' in both of those fields. 

I fear that many consumer who seek out LoanDepot 's services are vulnerable ( subprime borrowers ), less informed about their rights and remedies available to them, and may never complain to the CFPB or other regulators when they have been a victim of their unconscionable practices. Please take this complaint seriously, especially during this time of COVID-19 where financial losses to the every day person may have very serious personal consequences. It is not enough that you, as the consumer protection entity, simply send them the complaint and ask them to respond only to close out the file thereafter. Look into their practices, seek out their records and look at other similarly situated non-bank mortgage lenders for similar practices. 

Thank you for your attention.