Consumer complaint received 2019-09-16
Product: Mortgage — Conventional home mortgage
Issue: Closing on a mortgage — 
Company: Caliber Home Loans, Inc. (TX)

Summary : CHL disclosed fair rates and no discount fees, asked for up-front money, and then added in enormous fees and rate increases just before closing. We were left with the choice of cancelling the contract, coming up with cash on our own, or paying their jacked up price. CHL 's management decided that the original/disclosed rates & fees weren't " enough profit '' and would no longer approve the loan. In short, it was a bait & switch. 

Details : I used CHL on the recommendation of our realtor. Early in the process, I was told by the loan officer ( LO ) that there was a cap on interest rate at 5 % due to the low loan value ( {$65000.00} ), and as long as I paid the {$1300.00} ( very high ) processing/underwriting fees, then CHL would cover any cost to get the rate to 5 %. She said I didn't need to worry about " locking '' since my rate was capped and fees were fixed at {$1300.00}. This was reflected in a Loan Estimate that I was asked to sign on XX/XX/XXXX XXXX attached ). They asked that I pay {$500.00} to CHL for the appraisal up front, which I agreed to because the rates, pricing, and fees were quoted at maximum according to the LO. This is the amount I am disputing, since it is useless to me now and was paid before pricing changed. 

On XX/XX/XXXX, my LO called to say that management was unwilling to approve the loan because they " weren't making enough money on it. '' She said that I'd need to pay around $ XXXX {$3500.00} in fees and she wanted to know if I could split those with CHL. We politely requested that CHL honor the disclosures we'd signed on XX/XX/XXXX and move forward with the loan at 4.95 % with 0 points and {$1300.00} in fees. They refused, and I asked to speak with the LO 's supervisor, XXXX XXXX. He just kept repeating that I was getting the best pricing that CHL could offer. I'm not sure he ever understood my frustration on the bait & switch. He did agree that if this fee hadn't been disclosed and CHL said in writing that all fees were disclosed high, then he would honor that. I found in email where my LO had said : " If we do not disclose ALL possible fee 's in the beginning, we have to eat the fee 's that may come up later. '' " All of our fee 's and other lenders on the initial disclosures are high. '' " So we over price all initial fee 's to ensure we do not eat the cost of fee 's. '' " None of these fee 's are set in stone and are all over quoted. '' I can provide these emails if requested. But still, he refused to honor these statements and CHL 's loan estimates/disclosures because CHL wasn't making enough money on the loan. 

On Friday XX/XX/XXXX was the first time I received an updated loan estimate in writing, which showed {$2300.00} in " discount fee '' in addition the {$1300.00} for the same rate, which amounted to 3.5 points on the loan. Market pricing had changed less than .1 points over this time frame, a fact which I have confirmed independently with multiple other lenders. 

I spoke with XXXX XXXX on Friday XX/XX/XXXX ( regional VP at CHL ). I explained that I had been disclosed 4.95 % with 0 points and told verbally the rate was capped at 5 % and told in writing that fees were capped at the disclosed amounts, and I expected CHL to honor their own loan estimates and the statements from their own LO. She also refused to honor these, but did offer a {$250.00} credit if I closed with CHL. Unfortunately, the {$250.00} credit towards the {$2300.00} price increase didn't help at all. 

I have purchased 2 homes before this one and been through one additional refinance, so I've been through the loan process several times, but I've never dealt with anything like this. 

Final note : The loan estimates included a " rate lock '' page, but my LO said not to worry about this since my rate was capped at 5 %. Also, the disclaimer says " I am assuming the risk of any market rate changes between now and when I do elect to lock ''. And as mentioned, the market changes were effectively zero during this time frame ( 2 days ). The pricing changes were purely due to management 's profit scheme.