Consumer complaint received 2022-04-06
Product: Mortgage — Conventional home mortgage
Issue: Closing on a mortgage — 
Company: PARAMOUNT RESIDENTIAL MORTGAGE GROUP (CA)

Around XX/XX/XXXX, me and my wife started looking to purchase a new home. At the time we owned our current home and still had a mortgage which we were paying each month. Due to the rental rates in our area, in XX/XX/XXXX we made the decision to rent our home, instead of selling it. 
I researched lenders online to determine if there were any lenders that had less than 20 % down payment programs. I work in the mortgage industry ; therefore, I contacted a few lenders I know to see if they had less than 20 % down payment programs. Several of the lenders indeed had programs which offered less than 20 % down payment. Since most of the programs required at least 11 % - 15 % down payment, I decided to keep researching lenders for a program that allowed less than 10 % down payment. A lender named Paramount Residential Mortgage Group ( PRMG ) which states on their website ( link below ) We specialize in mortgages above the conforming loan limit with as little as 5 % down up to a sales price of {>= $1,000,000}. 10 % down up to a sales price of {>= $1,000,000}. Here the link to the website https : //losangelesjumbomortgageguru.com/manuel/? XXXX # XXXX I contacted PRMG to inquire about the 5 % down payment program. After speaking to the loan officer and understanding that I would have XXXX as a second mortgage, I felt comfortable with the program and decided to obtain a pre-approval letter. I provided all the necessary information/documentation for the pre-qualification and on XX/XX/XXXX, received a pre-approval for {>= $1,000,000}, with a down payment of {$62000.00}. Attached to this complaint is the pre-approval letter. 
Since we were looking for a new build there was one builder that refused the pre-approval letter, due to the mortgage company may not meet their deadlines for a conditional approval. 
On XX/XX/XXXX, we entered into a purchase agreement with the builder XXXX, to purchase a home in the amount of {>= $1,000,000}. XXXX also required conditional approval deadlines, which was XX/XX/XXXX, and close of escrow deadlines which was XX/XX/XXXX. PRMG was able to meet the first deadline and provided a conditional approval on XX/XX/XXXX. However, on, XX/XX/XXXX, I received an email from the processor on my loan at PRGM stating we are still short to close {$15000.00} not including the closing costs. At that moment, my wife and I were confused, how did we receive a conditional approval in XXXX, but now we are short to close {$15000.00} not including closing cost, nothing changed with our income, assets, or liabilities from XXXX to XXXX. Instead of renting our property we made the decision to sell and use the proceeds to pay the {$15000.00} and closing costs. We informed PRMG that we were going to sell instead of rent the property. 
On XX/XX/XXXX, our sell was completed, and I inquired with PRMG if we would be signing docs but was informed the XXXX loan docs were still pending. XX/XX/XXXX, at XXXX, I received an email from my loan officer at PRMG stating ; I am so sorry for the delay. Our second lien holder is giving us prolems since you sold your house. The change, changed our approval ( I would think for the better ) they are saying they are worried about payment shock and are worried that if one borrower leaves the others will have a hard time paying. They are NOW only wanting to approve us to 90 percent. We have the approval and can get docs but we have this change. 
I am so sorry. I think I am going to find a new second investor. Please call me if you want to discuss. The rate is better but it's an additional five percent down. Once again I'm sorry for the last minute change. We have been waiting for docs and I just got a call from management today. 
Once again we were confused since we sold our home we had over {$300000.00} in equity that we received, the day before we are set to close the XXXX company will not approve an additional 5 % because they are worried about payment shock and onXXXX person might leave. Why would there be payment shock on a XXXX loan that is XX/XX/XXXX loan nothing changed with our income, assets, or liabilities. Also, there are four people on the loan. Myself, my wife, my wife mother, and my wife father. My wife and me have been married for 12 years and together for 25 years. We just had a baby XX/XX/XXXX. My in laws have been married for 42 years. So, for PRGM to say they are worried if someone left the loan is not a condition for us to come up with an additional 5 % down, when we were conditionally approved by PRGM twice. Also, the loan officer offering to find another lender was not acceptable, when she knew that we needed to close escrow the next day. 
We did not want to pay the additional 5 %, but since we had sold our home and was waiting to close on the new home we were now XXXXXXXX, we had no choice, but to pay the additional 5 %. We paid the 5 %, closing costs and signed docs all on XX/XX/XXXX. We were thinking the nightmare was over, but it was not. On Friday XX/XX/XXXX, the end of the week, I was on the phone all day with the loan officer to confirm if we were going to close escrow and finally was advised that we would not be closing escrow. Once again PRGM was waiting on the XXXX company to close escrow, but they did not receive a 1004D in time to close. Once again, I am in the business, a 1004D can always be provided post close as well, but a 1004D was keeping me XXXX over the weekend. We finally closed escrow XX/XX/XXXX, after XXXX, the builder sent an email stating they would not hold up the property any longer and would have to charge us 1 % for delay passed XX/XX/XXXX. XXXX and the XXXX  company was able to close escrow after receiving that email. 
This 5 % program that PRMG offers seems like a bait and switch program, since PRMG knew I sold my home and have additional assets prior to close. The conditional approval in XX/XX/XXXX was based on use renting our home not selling it. We can not understand why the XX/XX/XXXX approval was changed after PRMG was provided the final settlement statement from the sell of our home. I am sure this is a TRID and/or UDAAP bait and switch violation, since PRGM change the offer 2 days prior to close when they provided a conditional approval XX/XX/XXXX.