Consumer complaint received 2016-02-25
Product: Mortgage — Conventional fixed mortgage
Issue: Application, originator, mortgage broker — 
Company: WELLS FARGO & COMPANY (CA)

During the application of for the loan the loan officer was told not to pull credit until he enquired with underwriters about various conditions related to the loan. He was also told not to pull credit if he was working with more than XXXX borrower on the loan. To spite our warnings to him, the lender was working with more than XXXX party and failed to disclose this to us. He also did not check on all the underwriting conditions prior to pulling our credit. Once he pulled our credit, along with the other borrowers and ran the concerns by underwriting after pulling credit, he noted that his branch had an overlay issue due to a recent purchase of another home. We had informed him of this prior to him pulling credit. This issue is a standard XXXX issue and for Wells Fargo is usually an automatic turn down as they typically sell their loans immediately. We had already contacted another lender who did not have the same concerns regarding the overlay. They could have done our loan. The problem here is that the Wells Fargo Lender realized that he would not be able to do the loan on this particular house if the builder allowed us to purchase it, as we were in first position to go under contract on the home. So, this lender informed the builder that we had too many red flags, and they should proceed with the other buyer. Through his actions he would be able to do the loan and receive the commission regarding this property. This home was the last of its kind and came at a substantially reduced price. The builder is no longer building this floor plan, and if they were it would be about XXXX more expensive. The lender did not call us to communicate that he was unable to do the loan. He only communicated with the builders agents. This was a breach of his fiduciary duty to us as we had not signed an agreement that would allow him to speak with anyone regarding our credit or buying potential. He also pulled credit without authorization causing our credit score to drop. We had specifically warned him against pulling credit if he was working with another borrower on the same home, and yet he pulled our credit on the same day as the other borrower. Our credit, debt to income ratios, and down payment requirements all fell in line. We did not have several red flags, only an overlay issue that another lender could have overcome. Because of this we lost the home and the potential for about $ XXXX worth of built in equity. Because of the credit pull, our score has now dropped enough that it would not be wise to try to find another home and restart this process. We have opted to build on to our existing home but will not be able add enough square footage to compare with the home we lost because of this lender. I believe the behavior of this lender is his standard operating procedure. In this event many qualified home buyers lose out on the homes that they would like to buy as this lender puts his needs for a commission above his clients need to purchase the home. This lender does not understand that he does not have the right to a dual fiduciary duty, nor does he understand the damage that he does by pulling multiple parties credit for the same home. Please contact me in regards to filing a formal complaint. I will not be buying another builders home to avoid being put into this situation again. I have worked in lending and real estate for many years and I would never treat a client the way we were treated in this situation.