Consumer complaint received 2018-03-25
Product: Mortgage — Conventional home mortgage
Issue: Closing on a mortgage — 
Company: GUARANTEED RATE INC. (IL)

Guaranteed Rate has made fraudulent, reckless, and negligent misrepresentations during an application for a mortgage, and its unfair methods and deceptive practices in handling the application for a mortgage has caused financial damages and inability to secure a mortgage on a property. 

On XX/XX/2018, we reached out to Guaranteed Rate regarding obtaining a mortgage for the transfer of title on the Property. The next day, we texted XXXX XXXX of Guaranteed Rate inquiring about obtaining a mortgage and the process by which we apply for a mortgage. We informed Guaranteed Rate that we wanted to do a cash-out refinance and XXXX XXXX texted Back that we should do this form of refinance. 

On XX/XX/2018, XXXX XXXX of Guaranteed Rate again us informing us that the best way to proceed with the transaction would be " as a second home cash-out refinance '' and that it would be " [ v ]  ery uncomplicated that way. '' After we asked XXXX XXXX to include another person on the texts, he stated he will and to text the person " you want to apply as a second home refinance ; cash-out. '' On XX/XX/2018, we texted XXXX XXXX of Guaranteed Rate inquiring about the " options for locking in a rate '' and where he " can see [ the ] current rates. '' XXXX XXXX did not respond. He delayed for several days and did not provide any rates or information. He eventually responded, in an indirect manner, texting to us that " we can price [ out ] all of the loan options... and go over credits from me against costs. '' XXXX XXXX, however, never once did this, after we continually asked him for rates. 

Guaranteed Rate by this point had laid its bait for the its bait and switch tactic. 

On XX/XX/2018, we submitted the necessary loan application materials per Guaranteed Rate 's instruction for " non-binding and no cost. '' XXXX XXXX received an email notification of the completion of the submission on this day. XXXX XXXX of Guaranteed Rate copied the other person to the texts on XX/XX/2018. 

On the following day, XX/XX/2018, we informed XXXX XXXX of Guaranteed Rate via text that the necessary application was completed online per your instruction. We texted Guaranteed Rate for rates to lock in and asked Guaranteed Rate to send the Good Faith Estimate, as required by CFPB regulations, namely 12 CFR 1024.7. Guaranteed Rate refused to provide rates or any information. XXXX XXXX stated in response " [ w ] e will be checking over the on-line applications and financial back-up documents tomorrow! '' Guaranteed Rate never responded regarding the application, rates, or with the loan options or the credits. 

We then texted XXXX XXXX of Guaranteed Rate three days later, XX/XX/2018, inquiring " do you have everything you need '' and what are the next steps. XXXX of Guaranteed Rate then said she was working on the file that day and would let the us know if Guaranteed Rate needs anything. XXXX sent a confusing email that day asking about documents from a completely different party, and then apologized due to working on multiple At this time, on XX/XX/2018, it was many days past the three days after we submitted the application on XX/XX/2018, and Guaranteed Rate had provided no information on its rates, credits, closing costs, or " Guaranteed '' and " locked '' rates, let alone a Good Faith Estimate, in violation of at least CFPB regulations. This is true despite us expressly requesting Guaranteed Rate to provide a rates and information including a Good Faith Estimate. Guaranteed Rate did not price out the loan options or go over credits, as it expressly represented. 

On XX/XX/2018, after not hearing anything for several days, we again followed up with Guaranteed Rate. We inquired whether XXXX XXXX and Guaranteed Rate needed anything else, as it had been nearly two weeks and no information on the application had been provided. Guaranteed Rate again delayed and responded that it was working on the file today and that it had everything. 

We then again inquired about how we see and lock-in rates and the process for locking in rates, costs, etc. XXXX XXXX and Guaranteed rate refused to respond and did not provide rates or costs. Guaranteed Rate didn't answer the question, and XXXX XXXX of Guaranteed Rate responded on XX/XX/2018 that " [ w ] e are working on putting your file together and working  out the debt to income rations for adding [ the wrong party ] to the property and both of you  signing for the new cash-out mortgage loan. '' We then informed Guaranteed Rate that it was working on the wrong file for the wrong person. 

We followed up asking, again " at what point are [ you ] able to lock in rates if we wish. '' Guaranteed Rate and  XXXX XXXX did not respond. 

We then followed up stating we " need to see a GFE per CFPB regs '' and need to have idea of rates and everything before signing or moving forward. 

After several misrepresentations and deceptive acts and failures to respond, Guaranteed Rate then provided, for the first time, a rate and estimate of costs. The rate and estimate of costs do not comply with Consumer Financial Protection Bureau regulations. The delayed rates Guaranteed quoted were " 30 year fixed rate 4.375 % - 0 points ; {$840.00} ; monthly for principal and interest. No credit from me against costs '' or 4.500 % - 0 points ; $ XXXXmonthly for principal and interest. {$960.00} credit from me to you against the refinance costs. '' Guaranteed Rate stated that the offer for the 4.500 % " is subject to market volatility until your lock in your new mortgage loan interest rate. '' Guaranteed rate did not place any contingencies on the 4.375 % rate offer. We immediately accepted the 4.375 % offer and lock in rate with the costs Guaranteed Rate quoted, providing XXXX of Guaranteed Rate with credit card for the application based on this locked in rate. XXXX of Guaranteed Rate confirmed she received, and was only authorized to charge for a 4.375 % rate loan. We then signed documents, including the Uniform Residential Loan Application signed and prepared by Guaranteed Rate, showing a 4.375 % rate for refinance. 

After XXXX XXXX and Guaranteed Rate laid the bait, stalled, delayed, dodged questions, and worked on the wrong file, the market unsurprisingly dropped 35 basis  points. XXXX XXXX and Guaranteed Rate had perfected its fraudulent switch in its bait and switch tactic. 

XXXX XXXX and Guaranteed Rate then attempted to renege on the 4.375 % rate offer. XXXX XXXX and Guaranteed Rate offer a new higher 4.500 % rate and ambiguously stated he and Guaranteed Rate would " reduce the credit accordingly. '' We then inquired what XXXX XXXX meant by " reduce the credit accordingly '' and inquired about how Guaranteed Rate would compensate us for its conduct. We also informed XXXX XXXX and Guaranteed Rate of its violations in not providing a good faith estimate, costs, rates, or anything. 

Being caught, Guaranteed Rate and XXXX XXXX then attempted another fraudulent and deceptive tactic to renege and tried to place blame on us. Guaranteed Rate first stated that the loan application that we submitted back on XX/XX/2018 was  marked as a no cash-out. This was a false and fraudulent statement in an attempt to get us to move forward with the 4.5 % offer. Guaranteed Rate made this fraudulent and deceptive accusation after it and XXXX XXXX had discussed at length via text and phone the nature of the transaction as a cash-out refinance. XXXX XXXX and Guaranteed Rate made this accusation after they stated they had received and reviewed the application several times over the course of weeks. Moreover, Guaranteed Rate 's application process does not have any questions on whether the mortgage is cash-out versus no-cash out, and the Residential Loan Application signed by XXXX XXXX and us likewise does not distinguish between a cash-out and no-cash out. 

To add insult to injury, after XXXX XXXX and Guaranteed Rate represented that they would provide the loan application submitted online by us, and we requested it, they made the remark that " I would think that the client would have printed out a copy of what they completed themselves, online. '' Again, XXXX XXXX and Guaranteed Rate misrepresented information to us in an attempt to place blame on us. My credit card was then charged {$550.00} for the application process and have not received a mortgage from another lender. 

We then requested to speak with someone in the legal department. When having discussions with the Guaranteed Rate 's legal department and compliance officers, they informed us that no one follow the Consumer Financial Protection Bureau 's regulations and that the regulations and agency have absolutely no teeth. They tried to place blame on us, stating they had no duty to provide rates or disclose information to us during the loan application. We told them we would investigate taking legal action and file a complaint with the CFPB.