Consumer complaint received 2016-01-14
Product: Mortgage — Home equity loan or line of credit
Issue: Application, originator, mortgage broker — 
Company: BB&T CORPORATION (MD)

We contacted Susquehana about refinancing our Home Equity Line of Credit ( HELOC ). One of the key factors the broker sold us on was an introductory rate of 2.49 % that would last for 12 months and then the loan would convert to a variable rate of " prime minus a .25 % discount '' for having a Susquehana free checking account with automatic loan payments deducted from that account. We explained that the purpose of the loan was to pay off the original HELOC ( which was {$210000.00} ) and to have the ability to use the HELOC for home improvement and a down payment on a XXXX home. The broker told us that we were approved for a {$420000.00} HELOC and steered us into taking out that loan. We ( and the broker ) well knew we did not need that large amount, but we assumed that based on a XXXX appraisal of our home and approximate first mortgage of {$700000.00} that this number represented an acceptable amount with in the LTV parameters required by the rates promised to us. We were never presented with any alternate loan figures or told that by agreeing to this amount, we would not be within the promised variable rate after the first year of prime minus .25 %. By steering us into this loan, we believed we would get the promised variable rate. So we accepted the offer and closed on the loan and opened the required checking account and had automatic withdrawals of the payments from that account. During the course of the first year, we only used under {$300000.00} of the HELOC. However, at the one year mark, the loan payments doubled. When we inquired what the new rate was, we were told that the loan reset to prime plus .25 % ( instead of the expected minus .25 % rate ). When we asked why, we were told that our overall loan amount at closing exceed the XXXX % LTV and therefore we were not entitled to the prime minus .25 % rate. The broker never explained that if the HELOC LTV ratio exceed a certain percentage that the introductory rate would reset to a higher APR after the first year. And we were never given an option of borrowing less so we would not exceed the LTV. And the disclosures do n't identify the LTV and the specific rate we will get in year XXXX. When we finally figured it out, it was too late. Indeed, we did not use XXXX %. 
We immediately contacted Susquehana and asked if they could lower the loan limit to bring us within the acceptable LTV limit but they could not. And they refused to reset the rate to the original promised rate. We feel that they maximized the loan figure for their own benefit and steered us into taking out a higher loan than we needed that pushed us above the LTV rate without disclosing that to us and thereby would n't allow us to take advantage of the lower APR rate after the first year - which they knew we would not figure out until it was too late. We had no way of knowing this would occur or that we were not within the acceptable LTV ratio until after the first year when the rate changed. By then it was too late and we are stuck with a higher loan we do n't need and higher interest payments. This is patently deceptive and unfair and even abusive! They steered us into a loan that pushed our LTV above 70 %, but we were only discussing terms of a loan that apparently required us to stay under XXXX %! In addition, we ca n't refinance because we would be stuck paying additional closing costs.