Consumer complaint received 2020-09-11
Product: Mortgage — FHA mortgage
Issue: Closing on a mortgage — 
Company: RESIDENTIAL HOME FUNDING CORP. (VA)

I am a real estate agent representing the sellers of a home that is being sold to a buyer who is obtaining an FHA loan. The contract was ratified on XX/XX/XXXX. According to the loan officer with whom I spoke, the file was submitted to underwriting at the very beginning of XXXX. The scheduled closing date was XX/XX/XXXX. As time progressed, I contacted the real estate agent representing the buyer, and was assured that everything was progressing on time. On XX/XX/XXXX shortly after XXXX I received a phone call from the buyer 's agent informing me that we would NOT be closing on XX/XX/XXXX. Keep in mind this is 50 days since ratification and about 43 days or so since the lender had the file, and this was the first I had heard of anything like this! When I asked why not and how long the delay would be, she said that the lender outsources their underwriting and " they are swamped ''. She didn't know exactly how long the delay would be but it could be about a 2 week delay. I explained how problematic that would be because my sellers are scheduled to close on a house that they are buying the next day, XX/XX/XXXX, and need the funds from the sale of their house in order to close. I also explained that the purchase contract for the house they are buying has a clause that if we don't close by XX/XX/XXXX, the contract will be void. The next morning, I spoke with the agent again and she said that although she had asked the loan officer to call her ( and had done so many times ), he just won't. She had never spoken with him. She said he prefers to communicate through email. So I took it upon myself to call the loan officer and left a message. I then tried calling the loan initiator, and she texted back telling me to text her. ( I guess she doesn't like phone calls either. ) So I texted her asking her to call me. She did not call me, but rather sent me the name, phone and email address of the loan processor. In the interim, I sent an email to the loan officer and the loan initiator expressing my concern about the delay, the impact it was having, and wanting some detailed explanation as to why this was happening ; a specific date for the resolution ; and confirmation that the buyer 's qualifications had not changed. I called the loan processor who did not answer, and could not leave a message for her because her mailbox was full. ( Seems to be a problem with this lender. ) So I forwarded the email I had just sent the others to the loan processor. ) At XXXX on XX/XX/XXXX, I did get a return phone call from the loan officer. He explained that the file had been submitted in the beginning of XXXX, but that turn around times are " brutal '' and that no one even opened the file for two weeks. Then there were some conditions that needed to be resolved. He explained that this meant that the buyer had to provide some additional information. ( I was aware of that because the agent for the buyer had informed me of that. ) However, as of XX/XX/XXXX while we were talking on the phone, no one in underwriting had reviewed what had been submitted to fulfill those conditions, so the loan officer said he was waiting for that to be completed. He also said that he had the manager of the department reviewing the file that day, and so the file should be cleared ( out of  underwriting ) the following week. I asked why, if the manager was reviewing the file that day, the file couldn't be cleared that day ( XX/XX/XXXX ). He said that it was possible that the manager could want additional information because he'd be reviewing the entire file again. I questioned why the entire file would be reviewed again, and not just the supplemental information that was provided ; however, I never got an answer. I also explained that the buyers would provide whatever additional information might be necessary ( he gave an example of a recent pay stub ) with a 10 minute turnaround because we all want this to close on time. The loan officer said that he would be speaking with the manager of underwriting at the end of the day that day ( the XXXX ) and would definitely give me a call on the morning of the XXXX to give me an update as to when the file would be cleared, and therefore, what date we could close. When I pressed for a reason why we were never informed of the delay, he said that most closings are taking at least 60 days. So I said, " in other words, this was never going to close on time? '' He said you're right. Never was. When I asked why I wasn't informed, he said that this is the way it works. People put down dates on a contract, whether they can be met or not, just to get the contract ; but he admitted that the ball was dropped in not notifying us of the delay earlier. After hanging up, I called the agent for the buyers and asked her to touch base with the Title company to be sure they have everything they need ( as the lender indicated he wasn't sure they did ). I also asked her to tell the buyers to be " at the ready '' because the lender told me the file was being reviewed that day and if anything else was needed, they would have to turn it around quickly! She did just that and called me a while later and said the Title company is all set to go ... they have everything they need! So I emailed the loan officer to tell him that, and to reaffirm that all we needed is to get the file cleared out of underwriting and that I looked forward to hearing from him the next morning. The next morning, I did not hear from the loan officer by XXXX, so I called him. His mailbox was full so I couldn't leave a message. I sent a text message instead, asking for a call and an update. I tried calling again after XXXX. Same thing ... couldn't leave a message. There was no communication from him whatsoever. I called the main switchboard and told the gentleman who answered that the loan officer was supposed to call me in the morning and never did. I asked him to please give the loan officer a message to CALL ME. He chuckled and said he would ... said he could see him in a conference room taking a test. Next thing I know, the loan officer sent an email which said " I thought they would get to the file this morning but not yet. They are hoping to get to it soon. '' Hoping to GET to it!! This is completely contrary to what he had told me the day before! He had explicitly told me that the file was being reviewed as we were speaking, by the manager of the department no less, THAT DAY, XX/XX/XXXX. That's why I asked if there was a chance it would be cleared that day. Now, the following day, he's saying they haven't even gotten to the file yet! I sent an email in the afternoon explaining all the promises that were made and not kept : the file not actually under review as we spoke ; no email to the team to update everyone on our conversation ; no phone call with an update the next morning ; no date as to when it will be complete. ( He had even told me not to tell the agent for the transaction that is going to be affected by the delay because he'd have an answer for me by the morning of the XXXX. Not so. ) Since I didn't feel like I was getting anywhere with the loan officer, I contacted the owner of the company by phone. He didn't answer, but rather texted me back asking for the name of the buyer, which I gave him. He said he was familiar with the loan and would call me shortly. He never did. He then texted me saying that he asked the loan officer to email everyone on the deal.That email basically said that my email was negative ( pointing out the promises that were made and not kept ) and that the underwriting department would " get to it as soon as possible '' ; and that the owner of the company said he'd try to get the file looked at as soon as possible. I tried calling the owner again, but he wouldn't answer. He also wouldn't respond to my text asking him to call me. So I told him that my only recourse is to complain to the CFPB. This is the substance of my complaint : When a lender accepts an application and its accompanying file for a mortgage, it accepts the responsibility of meeting the time commitment in the associated contract ; and if it can not meet that time commitment, it has the duty to inform all parties as soon as it is known that the time commitment can not be kept. There are ramifications to that! In this case, that was in early XXXX when they got the file and knew they were swamped and would not be able to fulfill their obligation -- not five days ( two of which are not even business days ) prior to closing. This was readily admitted by the loan officer. I know all closings impact multiple parties, but with five days notice ( again, not even 5 business days ), it is virtually impossible to re-schedule movers, electricians, dry wall laborers and painters, not to mention work and school ; and it has a negative impact on the ability to close other transactions, and may even result in void contracts or expired rate locks. Perhaps most infuriating is the callous nature with which the lender treats its customers. They act like they have you over a barrel because they know they do ... it becomes too late to find another lender, so you have no recourse. They don't have to answer phones. They don't have to keep promises. And there's nothing we as consumers can do except make complaints to the CFPB, so I hope this will be taken seriously. Thank you!