Consumer complaint received 2021-07-21
Product: Mortgage — Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: GUARANTEED RATE INC. (CA)

In XXXX of 2021, XXXX had seven ( 7 ) properties listed for sale on its website that were referred to as XXXX XXXX XXXX  XXXX XXXX as part of an Affordable Homebuyer Program for low to moderate income residents of XXXX XXXX County. 

On XX/XX/2021, I was contacted by XXXX XXXX of XXXX XXXX and told : CONGRATULATIONS, you were among the 7 selected participants to continue with the process to qualify to purchase a home under the Affordable Housing plan at XXXX XXXX. We are at the early stages with XXXX County to complete the necessary documents in preparation to effectively complete the purchase process. 

On XX/XX/2021, I received an email from KBHS Home Loans with an invitation to register for a Digital Mortgage which would allow me to track the status of my loan and view updates. According to the invitation, I would also be able to : View and print customized loan scenario estimates E-Sign initial and subsequent disclosure forms Instantly communicate with your Mortgage Loan Originator and Loan Processor Electronic asset verification and pay for your appraisal Receive alerts for additional information and upload requested documents securely Screen share with your Mortgage Loan Originator if you need assistance Access documents after the loan closes After completing my loan application, on XX/XX/2021, I was contacted by XXXX XXXX of KBHS Home Loans and given a list of supporting documentation needed to complete my Pre-Qualification. I submitted all documentation she requested. My loan number is XXXX, the status is application and my estimated closing date, according to the Digital Mortgage portal is XX/XX/2021. At no time prior to submitting my financial information for Pre-Qualification was I given specific details about the Affordable Homebuyers Program or the minimum credit score requirements or the purchase price or the down payment requirements. 
On XX/XX/2021, XXXX XXXX contacted me to inform me that I did not qualify for conventional lending thru KBHS and therefore was ineligible to purchase a Cottage in XXXX XXXX. According to XXXX XXXX, a minimum credit score of XXXX was required for conventional lending and my mid XXXX score was XXXX. Ms. XXXX indicated that the XXXX XXXX  XXXX XXXX project is not approved for FHA funding which according to her, allows a minimum XXXX  score of XXXX. I have since learned that FHA funding allows for a minimum XXXX  score of XXXX. 
I requested Ms. XXXX refer me to her manager. Thereafter, I was contacted by XXXX XXXX of KBHS Home Loans and told that I could boost my credit score by disputing the two negative marks on my credit and reducing the balance owed on my credit cards. At her suggestion, I paid my XXXX credit card to a XXXX  balance. According to Ms. XXXX, my credit score was not within an acceptable range for Pre-Qualification. I then decided to bring my XXXX XXXX credit card to a XXXX  balance which then boosted my credit score to XXXX. I expended nearly $ XXXX to reduce my credit balances. Ms. XXXX initially represented that based on my income, I would qualify for a loan with a 3.5 % down payment and she anticipated that $ XXXX would be due at closing with $ XXXX needed for reserves. This amount is vastly different from what is advertised on XXXX  website. 
On XX/XX/2021, my credit score was boosted to XXXX. Ms. XXXX contacted me and stated that she could not qualify me for 3.5 or 5 % down payment. According to Ms. XXXX, I could only qualify for a 10 % down payment with a {$110000.00} purchase price which meant I needed {$25000.00} for a down payment with closing costs and she needed the source of my down payment to go forward. This was my first disclosure about a purchase or the various down payment requirements. The XXXX County Development Authority website represents that the down payment for low-income purchasers is estimated at {$3000.00} for a purchase price between $ XXXX to $ XXXX, not {$25000.00} as represented by Ms. XXXX . I informed Ms. XXXX that I would be applying for down payment assistance grant thru XXXX County or some other affordable homebuyer program. 
On XX/XX/2021, I contacted XXXX XXXX of XXXX XXXX and arranged to view the property at XXXX XXXX XXXX XXXX XXXX on XX/XX/2021. As of XX/XX/2021, according to the XXXX website all properties were available for purchase except for one which was listed as under contract. When I arrived to view the property, Ms. XXXX indicated that all properties were in escrow, and none were currently available for purchase. Ms. XXXX stated that I was no considered a back up in the event another participant was unable to complete the purchase. 
I asked Ms. XXXX why XXXX XXXX or KBHS Home Loans failed to disclose this to me on XX/XX/XXXX and she stated that all properties entered escrow on XX/XX/XXXX even though they were and still are listed as available for purchase on both the XXXX XXXX website and XXXX  website. The Digital Mortgage portal still lists my loan application as open with an estimated closing date of XX/XX/2021. As a lottery participant, I fail to understand why a home that was set aside for me would be given to someone on the wait list without finalizing my pre-qualification process. I also fail to understand why I was not formally informed that the property was no longer available. A text message which I never received was insufficient notice not to mention it was disrespectful and unprofessional. 
KB Home Loans has since responded and said that the pre-qualification process, which was never disclosed initially, required a ten ( 10 ) percent down payment with a purchase price of {$110000.00} which still does not amount to $ XXXX as represented by Ms. XXXX. I explained to Ms. XXXX that I intended utilize one of XXXX Countys down payment assistance programs if I was required to pay $ XXXX as a down payment. Having never seen the home, I demanded a viewing before submitting additional documentation. According to KBHS Home Loans, In those intervening days, however, the consumer next in line for a low-income unit pre-qualified for a mortgage loan and secured the property. Ms. XXXX contacted you in advance of the scheduled appointment to advise that the property was no longer available, but she was unable to reach you. At no time did any participant explain that I was in jeopardy of losing the property. And, on XX/XX/XXXX, there were three vacant affordable properties. The website additional properties were available for purchase. I fail to understand how another purchaser was allowed to purchase the property set aside for me without finalizing the pre-qualification process. Also, the pre-qualification process seemed more like a loan approval process. XXXX XXXX and KBHS Homes work out of the same office. As a cover, XXXX XXXX and KBHS Home Loans have stated that they sold the property set aside for me to a XXXX men as though that negates the fact that they failed to make appropriate disclosures and engaged in unfair and discriminatory business practices.