Consumer complaint received 2024-11-21 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — Confusing or misleading advertising or marketing
Company: Lennar Financial Services, LLC
State: CA

Complaint narrative:
Subject : Formal Complaint Regarding Deceptive Business Practices, Misrepresentation, and Lack of Transparency in Home Purchase and Loan Process To Whom It May Concern, I am writing to file a formal complaint against Lennar XXXX ( the builder ) and Lennar Mortgage ( the lending entity ) concerning the home purchase and loan process for the property located at XXXX XXXX XXXX XXXX, XXXX, XXXX  XXXX ( Loan Number : XXXX ). Both companies are part of the Lennar Corporation, but I believe they have engaged in deceptive business practices related to the {$21000.00} rate buy-down credit, lack of transparency in the loan terms, and miscommunication between their departments. 

XXXX. Misrepresentation of {$21000.00} Rate Buy-Down Credit From the outset, Lennar XXXX ( through their sales representatives and loan officers ) misrepresented the {$21000.00} rate buy-down credit. This credit was initially presented as a straightforward incentive to reduce the interest rate on the loan. However, after signing the agreement and seeking clarification from the loan officer, I was informed that it was being treated as a promotional rate or bulk rate buy-down. These terms were never disclosed upfront and were explained with insufficient details, using terms such as off settlement, bulk buy-down, and XXXX, which are not industry-standard and remain unclear to the consumer. These terms were neither defined in plain language nor adequately explained in the documents provided. 

At the time of the agreement, I explicitly confirmed with the loan officer that the {$21000.00} credit would be applied toward the rate buy-down. This was a key part of my decision to proceed with the purchase. Yet, at closing, I learned that the credit was not applied as promised and instead, Lennar referred to it as a promotional rate, further complicating and confusing the matter. This misrepresentation violates the Truth in Lending Act ( TILA ) and XXXX XXXX XXXX XXXX XXXX XXXX XXXX  ), both of which require clear and accurate disclosures of loan terms, including how any credits are applied. 

XXXX. Lack of Transparency and Potential Deceptive Practices Throughout the process, Lennar failed to provide transparency regarding the nature of the {$21000.00} credit and the rate buy-down. The lack of clarity surrounding the credits application raises serious concerns about potential deceptive practiceswhere a consumer is lured into an agreement under false pretenses, only to find that the terms change or are not applied as expected. 

The terminology used in communicationssuch as bulk rate buy-down, off settlement, NFC, promotional rate, and rate buy-downwas introduced inconsistently by various departments involved in this transaction. Each department seemed to use a different term, with XXXX word being added to each email without clear explanation or proper definition. These terms were never properly explained or clarified in plain language, leading to confusion about their meaning and impact on the loan terms. 

Sales department first introduced the term bulk rate buy-down. 
Loan department used off settlement. 
Legal team referred to it as a promotional rate. 
Each of these terms is neither clearly defined nor standard in the industry, making it difficult for an average consumer to understand. This inconsistent use of terminology, coupled with the failure to provide clear, plain-language explanations, exemplifies the lack of transparency that violates consumer protection laws such as XXXX, RESPA, and state-specific XXXX XXXX Acts. 

XXXX. Unreasonable Delay in Response and Lack of Resolution Despite numerous attempts to clarify these issues directly with Lennar, including written inquiries and formal complaints, I have received no satisfactory responses. After sending legal notices and escalating the issue to higher management, there has been no acknowledgment of the serious issues I raised, nor has there been an effort to resolve the matter. The lack of response from Lennar 's legal and corporate management teams indicates either a deliberate attempt to avoid resolution or a complete failure in their customer service process.

Furthermore, Lennars apology email, sent in response to my complaints, did not address the core issue of the misrepresentation of the {$21000.00} credit or the lack of clarity surrounding the loan terms. Instead, they simply apologized for the confusion without providing a substantive explanation or resolution. This apology, while seemingly conciliatory, is a clear admission of mishandling and confusion on their part. If no mistake had been made, there would have been no need for such an apology. The apology serves only as a deflection, rather than an actual resolution to the miscommunication and financial distress I have endured. 

This sidestepping of the original issue highlights Lennar 's failure to take responsibility for the misrepresentations and the severe financial and emotional strain they have caused. The lack of a legal or financial remedy in the apology shows that they are not addressing the real problem at handthe incorrect application of the {$21000.00} credit and the lack of clear, transparent communication surrounding the loan terms. 

XXXX. Impact on Financial and Emotional Well-Being As a result of these misrepresentations and the ongoing lack of transparency, my family has suffered emotional distress and confusion. The confusion surrounding the {$21000.00} credit, combined with the last-minute changes to the terms of the loan, forced me to make significant decisions under extreme pressure. This situation has caused undue financial strain, as well as emotional distress, as I was led to believe that I was receiving the agreed-upon terms and that the {$21000.00} credit would significantly reduce my loans interest rate. 

Furthermore, the continuous delays and lack of response have further exacerbated the anxiety and uncertainty regarding our familys home purchase. The constant back-and-forth without clear answers is unacceptable, especially given the financial implications. 

Applicable Legal Violations : Truth in Lending Act ( TILA ) : Lennar failed to fully disclose the terms and conditions of the loan, including the exact application of the {$21000.00} credit and the promotional rate. 
Real Estate Settlement Procedures Act ( RESPA ) : The lack of clear documentation regarding the application of the {$21000.00} credit violates RESPAs requirements for transparency in settlement charges. 
California Consumer Protection Act : Lennar 's failure to disclose critical information regarding the rate buy-down process and potential bait-and-switch tactics may constitute deceptive business practices under state law. 
Federal Trade Commission ( FTC ) Deceptive Advertising : Lennar may have engaged in deceptive practices by advertising the {$21000.00} credit in a way that misled consumers about its actual application and terms. 
State-Specific Breach of Contract Laws : The failure to fulfill the contractual promise of a {$21000.00} credit, which was a central part of my decision to purchase the home, may constitute a breach of contract under California state law.

Breach of Contract and Promissory Estoppel : Lennar promised a {$21000.00} credit, which I relied upon in my decision to proceed with the purchase. The failure to deliver on this promise constitutes a breach of contract. Under the doctrine of promissory estoppel, I suffered harm from their failure to fulfill their promise. 
Additionally, Lennar 's last-minute suggestions to withdraw the application raise serious concerns about their lending practices. If a lender is legally obligated to act in good faith and it suggests withdrawal under duress, it casts doubt on their adherence to fair lending practices.

Company response to consumer: Closed with explanation