Consumer complaint received 2017-06-26
Product: Mortgage — Conventional home mortgage
Issue: Closing on a mortgage — 
Company: JPMORGAN CHASE & CO. (CA)

I believe I became a victim of a " bait and switch '' ploy used by one of the mortgage bank officers at Chase. The following describes a series of events that took place, and I list them in a chronological order. At or about XXXX XXXX on XX/XX/XXXX, XXXX XXXX, my loan officer at Chase, discussed with my father, XXXX XXXX, possible mortgage terms on a condominium that I was buying in XXXX XXXX. The loan officer reviewed with my father an offer I received from another mortgage lender, XXXX XXXX. The Chase loan officer then proposed to me a 4 % 10/1 ARM with a {$620.00} credit and no points and no costs, which essentially was equivalent to a total credit of {$1300.00}, which includes appraisal fees ( SEE EXHIBIT 1 ). She told us that if we move forward with Chase on that night, she can get the rate locked in for 30 days if she can receive the application before midnight ( SEE EXHIBIT 1A ). I sent in all my application materials including all supplementary materials such as the most recent 30 days Paystubs, XX/XX/XXXX and XX/XX/XXXX XXXX and XX/XX/XXXX and XX/XX/XXXX complete Federal Tax Returns, all Schedules ( no CA Returns ), etc. Then, around XXXXXXXX XXXX she sent me an email stating that since my purchase agreement stipulates a 45 day escrow, she can not lock me in for 30 days. For a 30-day lock, she stated that the rate of 4 % would still  remain the same but the lender will have to charge me {$680.00}, that is, she has to take away the earlier {$620.00} credit she offered me. I immediately contacted my real estate agent on XX/XX/XXXX, to see if the Seller would agree to change the Close of Escrow from 45 days to 30 days. The seller  immediately agreed that evening and the final addendum was received on XX/XX/XXXX ( SEE EXHIBIT 2 ). So I informed my loan officer of this change. She said that everything will be acceptable to Chase.
She then said that Chase would still need 6 months of reserves in escrow. I immediately produced the evidence of sufficient reserves on my retirement account. I asked XXXX to see if Chase would let me shop around for a Mortgage Insurance ( MI ) company because the Chase MI company lenders charge {$210.00} when other companies charge only {$84.00}. She said that I will not be permitted to do so and she can not disclose the identity of the MI Company. The Chase mortgage loan officer, XXXX, and I reviewed all the documents together and our application was submitted and received by midnight for the 30-day rate lock. The rate she offered was at a 4 % 10/1 ARM with the {$620.00} credit and no points and no costs. ( FIRST BREACH OF VERBAL CONTRACT ) On XX/XX/XXXX, XXXX told me that she could not honor Chases original offer of 4 % 10/1 ARM with the {$620.00} credit and no points and no cost, and the rate could not be locked in the night before, as promised. For the rate lock, she stated that she needs an 18 months reserves, and not 6 months. Chase can not possibly change its terms after it was confirmed to me that the rate would be locked. She said, however, that she can now lock the rate at 4.125 % at 7/1 ARM with {$27.00} of total lenders costs but still no points, if I submit the application as of XX/XX/XXXX. XXXX told me that if we dont lock the rate today, the rate will change again. This was my biggest fear, and she knew that ( SEE EXHIBIT 3 ). I was shocked at how the rate had changed suddenly, now that the application is in the hands of Chase, and the escrow period has been shortened. The Chase loan officer then told me that the rate would change again over night and this left me feeling cornered to have to accept whatever changes Chase decided to demand.
Chase requested that i shorten the escrow period to 30 days, yet at this point, had already changed the rate of my loan once. This led me to spend the whole day on XX/XX/XXXX to see if there were other lenders who could beat the rate. Please keep in mind, this is during holiday season and many offices were already closed. I had a difficult time to get a hold of other lenders. Despite the fact that Chase did not honor its initial offer and the monthly mortgage insurance is higher than elsewhere, I felt forced and cornered to accept this offer, given the running escrow time. ( SECOND BREACH OF VERBAL CONTRACT ) The Chase officer and I talked on the phone, and I asked her to put those numbers in writing. I wanted to make sure that she will not change the loan terms again. Around XXXX XXXX, XXXX sent me an email confirming todays rate of 4.125 % on a 7/1 ARM but now with {$680.00} in total lenders costs, no points. This is on a 30 day lock. Now, at this time, once again, the lenders cost went up from {$27.00} to {$680.00} I immediately sent XXXX an email message asking her to lock the rate the way she outlined. XXXX responded to confirm the request, and I thought that XXXX would lock the xrate for me at this revised rate of 4.125 %. I reconfirmed at XXXX XXXX by an email. By XXXX XXXX, XXXX was already working on due diligence on my files ( SEE EXHIBIT 4 ). ( THIRD BREACH OF AGREEMENT ) Later that night, I was contacted by XXXX, now explaining to me that she could not lock the rate because there was a computer glitch on the part of the bank. She called my father and told him that the new rate is now 4.25 % with XXXX points. Can you imagine my shock? The loan terms were changing every minute regardless of whether Chase earlier assured me of the rate lock even in writing. I was very surprised, felt cheated, and felt very helpless. She told me that either I take the deal or I need to go elsewhere. I felt backed into a corner and felt threatened. There was no choice but for me to continue moving forward with Chase, given that I had put an earnest money deposit of {$18000.00} in escrow and the clock is ticking. This money would be forfeited if I did not meet the 30 day escrow deadline. In my opinion, Chase broke its verbal commitment and contract, and this breach was not based on good faith and fair dealing. The very next day, on XX/XX/XXXX, I received an email from XXXX who admits that Chase made an error, due to a computer glitch ( SEE EXHIBIT 5 ). ( FOURTH BREACH OF CONTRACT ) The next day, on XX/XX/XXXX, I called to see if she did anything about my application. What she said next was incredibly shocking. She again surprised me by letting me know that she locked the rate in at 4.125 % but with XXXX points as has been shown on the Closing Disclosure ( SEE EXHIBIT 6 ). This XXXX points was absolutely new to me, something that she has never told me before. Ever. What has happened to the banks full disclosure requirement to customers? She told me that she locked the rate at 4.125 % as agreed but instead she built a XXXX point upfront fee in the transaction hoping that her manager will remove it later for us. She gave me her managers name, XXXX XXXX. ( FIFTH BREACH OF CONTRACT ) About a week prior to the closing of the escrow, XXXX XXXX came back to me to let me know that Chase has decided to lower the point from 0.75 % to XXXX ( SEE EXHIBIT 7 ). This is not how we agreed, to begin with, and furthermore, I wanted to have the whole procedure proceed without fearing about how the underwriting department can possibly delay and eventually end the whole transaction. There were only a few days left before the escrow expired. The only reason why I agreed to sign Chase 's loan agreement was out of my fear that the whole loan will fall apart. The escrow 30-day time clock was ticking, we were in the XXXX and XXXX XXXX holiday season. It was impossible to find other lenders who were available and could act quickly enough to meet this now less than 30 day time window. I feel duped, cheated, threatened by acts that Chase exhibited throughout this whole loan process, starting from day one. In the end, I ultimately was penalised by Chases admission of a computer glitch. Chase committed bait and switch acts that are reprehensible.