Consumer complaint received 2021-04-28
Product: Mortgage — FHA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: Mr. Cooper Group Inc. (VA)

I was contacted by my existing mortgage provider and offered an opportunity to refinance my FHA mortgage with my mortgage company ( Mr Cooper ). 

I was advised that due to being an excellent customer and not being in arrears for the life of my loan I had qualified for a program called a Streamline refinance. 

My refinance was done in and around XXXX XXXX of XXXX. 

During my discussions with regard to the refinance, I was advised, before I began every telephonic discussion, that due to the nature of the discussions, all calls were/ would be recorded and I was asked if I would agree to my calls being recorded. 

I was further advised that if one does not agree to being recorded, the telephonic call discussion would not proceed. 

I agreed to every call being recorded. 

During my telephonic discussions with the loan officer, a Mr XXXX, and prior to agreeing to the refinance, I specifically enquired as to the process and requirements to have my PMI ( private mortgage insurance ) cancelled. 

My private mortgage insurance costs approximately {$280.00} and is paid on a monthly basis. 

The loan officer advised me that PMI will be removed/ cancelled when my loan to value ( LTV ) ratio reaches a 78 % to 80 % threshold. 

The loan officer went on to further describe the 3 scenarios which usually result in achieving the required LTV of 80 % : 1 ) when my loan is paid down with regular or a lump sum payment such that the required LTV is achieved. 

2 ) If the homeowner, did renovations or home improvements that resulted in an increased value of the home, to the level where the new value of the home resulted in achieving the required LTV. 

3 ) When the market value of the home increases due to external market conditions that result in the home becoming more desirable and valuable and hence resulting in an increase in the value of the home which subsequently achieves the required LTV. 

The information provided by the loan officer, was the same as what I had found while researching on line ( and what was subsequently confirmed by the CFPB when I called in recently ). 

Knowing that I was due to receive a substantial amount of funds in XXXX and believing that my property would likely achieve not one but probably all 3 of the scenarios, I relied on the information provided to me by the loan officer and I signed up for a mortgage refinance with Mr Cooper. 

By XX/XX/XXXX, I had 3 of my immediate neighbors sell their properties for substantially more than previous sale prices. 
All 3 of these homes are exactly the same in both age and design, as my home, as we live in a community development. 

The pandemic had resulted in a surge in demand for homes and as a result the prices of homes increased substantially. 

With the extremely low APR rates being offered and together with the increased home values, I called my mortgage provider ( Mr Cooper ) in and around XX/XX/XXXX to enquire about having an assessment done on my property so that I could cancel my PMI as well as refinancing at the lower available rates. 

I was then told by Mr Cooper that my PMI could not be cancelled. 

I explained to Mr Cooper, the exact details surrounding my discussions and the recorded telephonic conversations that I had with the loan officer in XXXX. 

I emailed Mr Cooper several times requesting for the voice recordings as well as transcripts of the recordings. 

I explained that I had relied on the information provided by the loan officer in XXXX to make my refinancing decision and I believe I had been misled by both Mr Cooper and their loan officer. 

I was told that Mr Cooper could not provide me with the recordings and that discussions would be had with the loan officers manager with regard to my suggestion that there had been misrepresentation on the part of the loan officer and hence the mortgage company, Mr Cooper.

I had hoped that if they did not want to release the recordings directly to me, then they would request for the management team to listen to it privately to verify my claims. 

I wrote several emails to Mr Cooper, all detailing that the telephonic recordings were mandatory and that these recordings would confirm my version of the events. 

Initially my requests were ignored but when I persisted, I was repeatedly denied access to the recordings and was subsequently advised that these recordings would not be made available to me. 

I have repeatedly been told that I signed the loan documents with Mr Cooper and was therefore bound by the contract. 

I accept this as Fact and have a copy of the signed contract. 

I have tried repeatedly to explain that the loan contract was entered into with Mr Cooper and myself based on a misrepresentation that was perpetuated by Mr Cooper and their employee. 

I subsequently read the TILA ( Truth in Lending act ) and responded to Mr Cooper by stating that the mortgage provider ( Mr Cooper ) owed me, the customer, the greatest duty of care and good faith and they have fallen far short of this requirement. 

As a first time home buyer, the duty of care is greater and the very essence of the TILA was to protect consumers from unscrupulous mortgage loan providers. 

The wording surrounding the cancellation of PMI is a, grey area as it is an event that usually occurs only during the latter part or late in the life of the mortgage : It is not a scenario that is detailed in writing in any part of the initial loan contract as it never applies to the initial contract but it is a scenario that can only occur at any time subsequent to the signing of the mortgage contract. This is what results in my use of the term, Grey Area Despite all the on line material and discussions clearly stating that it is an event that can occur both naturally, by the passage of time and by events controlled by the home owner as well as events beyond the control of both the home owner or the loan provider ( market demand ) and should therefore be clearly detailed in all loan contracts. 

It is a very real and inevitable scenario and should be spelled out in full and absolute detail. 

The very purpose of PMI is to protect the lender who has offered a loan to a client, that said client, not being able to fulfill the required 20 % down payment required during conventional mortgage loans. 
The risk to the lender is mitigated by having the PMI. The additional payment for the PMI is paid for by the home owner and the cancellation thereof should be based entirely on objective facts and not on subjective decisions made by the mortgage provider. 

When the LTV reaches the 80 % ratio, the risk to the lender no longer exists and with the removal of the risk to the lender, hence the PMI should be removed as well. 

Despite all the overwhelming evidence and facts, Mr Cooper refuse to release the recordings and despite acknowledging an error/ miscommunication on the part of their loan officer, they refuse to rectify the situation. 

It has been 5 months since my original request to Mr Cooper, they have repeatedly delayed on every request and have not responded to my last email hence my call and subsequent complain to the CFPB. 

The delay has cost me the opportunity to take advantage of the lower APR rates that were on offer at the time as well as preventing me from being able to resume post forbearance mortgage payments .of what I estimated would be my revised mortgage payment.