Consumer complaint received 2017-08-07
Product: Mortgage — Home equity loan or line of credit (HELOC)
Issue: Struggling to pay mortgage — 
Company: CIT BANK, NATIONAL ASSOCIATION (MD)

The subject Loan is a HELOC and is collateralized by a second deed of trust lien on a single family home property located at, XXXX, Maryland XXXX ( Property ) and was originated by XXXX XXXX in XX/XX/XXXX. The Loan had a maximum credit limit of {$130000.00}. In early XX/XX/XXXX the Loan was frozen, with a balance of approximately {$120000.00}, thus, no further disbursements could be made against the account. On XX/XX/XXXX XXXX was closed and placed in receivership controlled by the FDIC. In XX/XX/XXXX XXXX was purchased at auction by OneWest Bank. OneWest purchased the loans, including the subject Loan, at various discounts based on type of loan and payment status. The purchase price of the various loan pools is outlined on schedule XXXX of the loan sale agreement. The subject Loan was current and paying as agreed, therefore, I believe the Loan was purchased at 58 % of the outstanding balance. The subject Loans outstanding balance at that time was approximately {$120000.00} which would have resulted in a purchase price of {$70000.00}. In XX/XX/XXXX OneWest Bank was acquired by CIT Bank for approximately {$3.00} XXXX dollars. According to CITs ( Bank ) XX/XX/XXXX Annual Report, page 24, the Bank utilized the purchase method of accounting to record the purchase of the loans, including the subject Loan. We knew that the Loans monthly payments would increase after the interest only period due to an adjustment in interest rate and the addition of an amortization period. We attempted several times with several different financial institutions to refinance and combine the existing first deed of trust loan and the Loan into a new loan. Given the market conditions of home prices in the area, the combined loans exceeded the value of the Property. Therefore we were never able to secure a loan since the Property was severely under water. On XX/XX/XXXX, we received correspondence that CIT acquired XXXX XXXX XXXX and that OneWest would be the servicing agent for the Loan. Knowing that the interest only period was expiring within the next 12 to 18 months, we were desperate for help and reached out to OneWest Bank via registered mail on XX/XX/XXXX, but received no response. On XX/XX/XXXX, another letter was sent via registered mail requesting assistance on the Loan. On XX/XX/XXXX, we received an email from CIT and a call from a XXXX XXXX XXXX. In the conversation with XXXX XXXX, I went over the looming problem of not being able to afford the increase in the monthly payment amount following the expiration of the interest only period. My wife and I exchanged several emails and information with OneWest, however according to OneWest, CIT would not be able to help unless we qualified for a 1st mortgage modification - a specific program designed for individuals who were behind on their first mortgage and nearing foreclosure. We were not in that situation and did not qualify for the modification. We complained and our issue was escalated to XXXX XXXX XXXX for assistance. We again laid out our situation for XXXX XXXX. XXXX XXXX asked for a hardship letter which we provided. Again, it came back that CIT bank could not help us. We received a letter on XX/XX/XXXX, going over various details and rational for declining our request for a short payoff. The letter also recommended we speak to its lending department for refinance options. We followed her suggestion and the CIT loan officer said they could not help in any way due to the loan to value ( LTV ) exceeding 100 %. The expiration of the interest only period is expiring on many of the HELOCs originated prior to the financial crisis of XX/XX/XXXX resulting in escalating defaults by borrowers and financial institution absorbing large loan losses. The Office of the Comptroller of the Currency ( OCC ), who regulates your bank, stated in a XXXX XXXX XXXX article dated XX/XX/XXXX, that financial institutions should strive to resolve matters with HELOC borrowers in order to mitigate financial damage to both borrowers and financial institutions. Current : We received a letter from CIT dated XX/XX/XXXX that informed us of the increase in the payment to approximately {$1500.00} and that if there is a potential hardship, to contact the bank to discuss options. We did contact the bank in XX/XX/XXXX and XX/XX/XXXX and were able to speak to a representative who instructed me to contact the Short Sale workout staff. They instructed me to put together a reasonable offer of a reduced final payment of my Loan and fax it to this number XXXX as well as mail it to the processing center in XXXX, TX. They did not provide a name to contact. We are in the process of refinancing the property in order to attempt to pay off the Loan held by your institution. We are working with XXXX XXXX and are quite far along in the process. Application, preliminary approval, and an appraisal were ordered by XXXX, under the guidelines and regulations of Dodd-Frank. On XX/XX/XXXX, we received a copy of the appraisal ordered by XXXX XXXX XXXX XXXX and paid for by us. Under the XXXX XXXX guidelines, as established in the Dodd-Frank legislation, our loan will be considered cash out refinance and we are limited to borrow a maximum of 90 % loan to value. According to the appraisal ordered by XXXX, the Property appraised for {$500000.00} ( see attachment 4 ). Based on the appraisal and XXXX  lending guidelines, we can borrow a maximum of 90 % of the appraised value of the Property or {$450000.00}. After paying transaction costs and paying off the existing first lien, we have remaining funds of approximately {$80000.00}. ( which was low but a starting point ) On Monday XX/XX/XXXX, I called CIT bank and was informed I was denied the ability to work some kind of settlement. I spoke with XXXX who said I did not sent the package to the proper place. I then put together a package with my Taxes, proof of employment, pay stubs, a budget and an offer. This was faxed on Tuesday XX/XX/XXXX. I called on XX/XX/XXXX and found out I was denied again ... all because I was current on my payments. I spoke with XXXX ( ID number XXXX ) .... I was told that CIT policy is not to settle on any loan that is current and that for any settlement I had to fall behind in my payments or be in default and then contact the bank for a NON-GUARANTEED settlement offer. My ability to make payment is hampered moving forward and I HAD the ability to refinance and resolve this problem IF CIT would take a short payoff. I lowballed the offer and was NEVER able to speak to someone who help. No person contacted me directly at all. I find the unwillingness to negotiate a slightly reduced payoff unless I am in default unreal. They MIGHT deal IF I stop paying, ruin my credit and then be UNABLE to qualify to refinance. No one is thinking this through unless I am caused severe pain and TRUE hardship.