Consumer complaint received 2025-05-30 00:00:00
Product: Mortgage — VA mortgage
Issue: Closing on a mortgage — Delays with the closing process
Company: Dovenmuehle Mortgage, Inc.
State: NV

Complaint narrative:
I recently closed on the sale of my property through a VA loan assumption. 

My current lender 's mortgage servicer, Dovenmuehle Mortgage Incorporated ( DMI ) took 6 months to close on the sale of my home due to erroneous and illegal requirements the company has as its policy. This institutions policies are unethical, discriminatory, predatory and illegal under Federal Law.

Firstly, the company violated Regulation Z/TILA, by not disclosing fees properly.

Secondly, the company also violated Federal Law by requiring that the buyer pay over {$3000.00} in assumption fees prior to submitting his loan to underwriting. 

Lastly, the company has repeatedly requested documentation that is not needed or that has already been submitted. They have ignored phone calls and emails and failed to answer simple questions and requests throughout the process. Overall took every step they could to delay and illegally deny myself and the veteran buyer our rights to VA home loans, while at the same time misrepresenting their relationship with the VA by stating they have a representative their that works with them on the process. 

The most recent issue I have had follows : The sale of my property closed on XX/XX/XXXX. Afterwards, on XX/XX/XXXX, DMI requested my title company send a newly signed assumption agreement with my wife 's signature. This was never requested prior to this and is not needed. My wife was never listed on the loan or title as an owner as I purchased the property prior to marriage. The company has a copy of the signed and approved assumption agreement as well as all other documentation needed. 

I am no longer the owner of the property however, DMI continues to delay processing my assumption due to erroneous requirements. This is just one issue in a long line of erroneous and illegal requirements in order to delay the assumption of my property, which I will outline below.

Firstly, DMI required the buyer pay an assumption fee, which includes closing costs such as the VA funding fee, for a total of thousands of dollars be paid prior to submitting the buyer 's loan application to underwriting. 

The amount requested as an assumption fee changed several times while I and my title company have been attempting to clarify this issue with the bank. This requirement directly violates VA policies, federal regulations and the normal industry standard of paying closing costs at closing and not prior to loan submission and approval. 

Furthermore, the fact that these fees needed to be paid upfront prior to loan underwriting was never disclosed to me until XX/XX/XXXX- this is months after I and the buyer had submitted our assumption application in XX/XX/XXXX. I contacted my bank 's Chief Lending Officer and President of Home Loans on Thursday, XX/XX/XXXX via email after I nor my title company had received any response to our multiple inquiries over email and phone over the course of several days. On Friday, XX/XX/XXXX the bank confirmed with me that it is the bank 's policy to collect this assumption fee prior to submitting the buyer 's loan application to underwriting. 

The bank 's stated policy with assumption fees and charging closing costs prior to loan approval directly contradict the below regulations and VA guidelines. These outline the specific fees that can be charged by lenders to include a maximum {$300.00} charge for assumption fees- we were required to pay thousands in assumption fees by labeling the closing costs and VA funding fee as an assumption fee which the lender is required to be paid prior to loan submission to underwriting. 

Furthermore, these guidelines state that the funding fee should be paid at close or upon loan transfer and specifically outline the process of assumption and when these fees are to be paid. XXXX : XXXX XXXX,. XXXX XXXX : XXXX XXXX. XXXXXX/XX/XXXXXXXX I reached out the VA who advised me that, yes, the maximum assumption fee to be charged for

VA assumption is {$300.00} and that the VA funding fee is a closing cost and should not be required prior to loan submission and underwriting. I would also like to note that these practices appear to me to be unfairly discriminatory against veterans and their processing procedures for VA assumption applications appear to be intentionally delayed in order to
discourage veteran 's use of a fundamental feature of the VA loan since assumptions do not earn a significant revenue stream for the company. This banks policy of requesting thousands of dollars in fees prior to loan underwriting seem discriminatory against veterans and appear to be unfair and deceptive practices particularly when these fees were not disclosed months after the loan application was submitted. 

See below on clarification on discrimination allegations at DMI against veterans. Please note if you look through XX/XX/XXXXXXXX reviews you will find various people who have had similar treatment and who were denied their right as a veteran to use the assumption process with a VA loan. 

Discrimination Allegation Clarification DMI 's lending practices, specifically its Veterans Affairs loan assumption processing procedures appear to be unfairly discriminatory against veterans. DMI intentionally through their policy and unintentionally through gross negligence attempted to block the assumption and sale of my property from XX/XX/XXXX- XX/XX/XXXX. 

DMIs assumption loan processing procedures are not in accordance with federal regulation and VA assumption procedures and discriminatory against veterans for the following reasons : XXXX. They charge assumption fees to veterans, and only veterans, for greater than the specified amount of {$300.00} in violation of VA loan regulations. 
2. They require closing costs to be paid by veterans up front for VA loan assumptions in violation of CFR and attempt to deny veterans their benefit of assumption by using closing costs as a defacto application fee in violation of VA loan regulations.

3. They do not disclose to veterans that their bank policies require the above fees to be paid directly to the bank prior to loan underwriting rather than at closing in violation of Regulation Z, TILA. 
4. They intentionally delay veterans VA loan assumption submissions beyond the specified timeline in violation of VA loan regulations.

5. They have a near-impossible to meet requirement of requiring a recorded deed prior to approving VA assumptions and closing of sales. Recordation of the deed and assumption must be done simultaneously as it is not possible to transfer title prior to assumption being approved.

6. DMI appears to be actively deprioritizing and delaying the approval of VA assumptions unfairly targeting veterans.

7. DMI mispresents their relationship with the VA by stating they have veteran affairs staff who they work hand in hand with, which is not the case as they do not even know the correct processes or procedures shown by their multiple violations.

I. Closing Costs, Assumption Fees, VA Funding Fee Firstly, DMI required closing costs, such as the VA Funding Fee to be paid up front prior to loan assumption underwriting in the form of assumption fees. This appears to be incorrect and discriminatory for several reasons. VA assumption procedures limit assumption fees to {$300.00} via XXXX XXXX or {$460.00} through XXXX XXXX, XXXX XXXX XXXX. The buyer of my property was charged {$3900.00} in assumption fees prior to the bank submitting his loan application to underwriting. These charges included closing costs and were specifically stated to be assumption fees which were required to be paid to DMI before the loan application would be sent to underwriting or approved. 

Additionally, this amount changed several times over the course of the several months and we were never disclosed that these fees were to be paid prior to closing and even prior to loan underwriting in contradiction of normal lending and closing practices. 

Secondly, the VA funding fee and other typical closing costs are expressly instructed to be paid at closing/time of transfer in XXXX XXXXXX/XX/XXXX XXXX XXXX These closing costs are not due to the lender prior to loan underwriting as DMI currently requires. 

Thirdly, DMI is not processing VA home loan assumptions within the timeframes established in federal law, by not submitting loan applications within 35 days of receipt. DMI 's policy of charging closing costs as an assumption fee prior to loan underwriting creates a situation where closing costs act as a de facto loan application fee for veterans using a home loan assumption. No other home loan or group of individuals, besides veterans, has the expectation or requirement that thousands of dollars in closing costs be paid directly to the lender prior to closing, let alone prior to a loan application approval, in the manner that this bank currently requires. 

These policies on charging closing costs as assumption fees appear to be unfairly targeting veterans specifically and appear to operate contrary to federal regulation and VA procedures. DMI 's requirement of receiving payment of closing costs as assumption fees prior to loan underwriting appears to be an attempt at circumventing federal regulation and VA loan procedures that limit the amount that can be charged as assumption fees. This policy directly hinders their veteran customers abilities to use VA loan assumptions. 

II. Delays in Loan Application Processing and Assumption Approvals Additionally, besides the issues with the fees, DMI has been extremely slow in processing my VA home loan assumption. The process started in XXXX and they still have not completed the assumption even though the sale has already closed. 

Typical home sales take 30-60 days to close. We are reaching 6 months of delays after three missed closing deadlines due to the banks erroneous requirements. I do not know of any other kind of loan that requires this long to close, and it appears to only take this long for veterans using the VA assumption process. I know of many other lenders who have no issues closing on VA assumptions within a month or two. 

Furthermore, the VA requires approval or disapproval of the loan assumption within 35 days of receipt of the application. DMI is obviously aware of this requirement as they had the buyer change the date and re-sign his loan application after they had received the assumption fees since it had taken them much longer than the specified timeline to submit his application. DMI not only requested the above amount in assumption fees, but also requested differing amounts at several different times starting with over {$11000.00}, which was not disclosed until XX/XX/XXXXwhile the loan assumption application was submitted in XX/XX/XXXX. 

After DMI received the requested amount of {$3900.00} they instructed the title company to send them the recorded deed prior to the approval of the assumption agreement. This is impossible until the assumption agreement is approved because the sale is contingent upon the approval of the assumption. 

My title company explained that the deed and assumption agreement should be recorded simultaneously, but was then continuously instructed by the bank that they would not approve the assumption until the deed had been transferred, once again further delaying closing. It was only after my lender and DMI discovered that I had contacted the FDIC that they decided to give a special exemption to company policy and send the title company some of the documents needed to close the sale, but they continue to ignore my title company 's request for all of the information and documentation needed to close the sale. 

The title company repeatedly requested that DMI correct their assumption agreement documentation as it stated that I am single, while the deed of sale, which was sent to them multiple times times, clearly states I am married. DMI also refuses to provide documentation to the title company stating whether they require modification endorsement or not and is not providing the title company information needed to close the sale.

In effect, DMI has attempted to delay or outright deny me the ability use my VA loan assumption benefit, and I suspect since DMI staff told me this is their normal processes and procedures that many other veterans have been denied this same right through the banks practices. 

III. Effect on Veterans I believe the intent behind all of these actions is to slow down and delay the home loan assumption process as much as possible while at the same time creating a massive unfair financial burden on veterans who would like to assume loans in a systemic effort to dissuade or prevent veterans from buying or selling property using VA home loan assumptions which are a fundamental feature of the VA home loan program. 

I suspect this practice has not only affected myself and the buyer of my property but a large number of veterans by delaying assumption approvals until a loss of sale or foreclosure occurs. I would not be surprised to discover that this institution has approved very few if not any VA loan assumptions. This is due to several reasons. 

Firstly, they delay assumptions for months at a time and their policies of charging thousands of dollars prior to underwriting make it likely that many buyers would back out of any sale. 

Secondly, the requirement of requiring a recorded deed prior to assumption approval makes it impossible to close in most if not all cases- I am not sure how it would be possible. 

Thirdly, when repeatedly asked about endorsement requirements by the title company, the bank did not even know what the title company was referring to and did not know what ALTA 11 or endorsement modifications were.

Fourthly, they apparently do not know the correct processes and lender responsibilities when conducting an assumption in regards to CFR and VA regulations. 

Overall, these factors make it seem that they have little to no experience with actually closing assumptions. I believe this to be intentional and by design of their policies. 

Other lenders such as XXXXXX/XX/XXXX have been found to be using very similar techniques to prevent veterans from using their VA loan benefits. And still a large group of other lenders have been found to charge illegal fees to veterans for VA loans. I believe that DMI is doing the exact same thing as these banks which were previously fined and sued over similar illegal activities. 

I will discuss each topic in more detail below with references from the VA and Federal Regulations. XXXX. Regulations on charging assumption fees. XXXX bank required the buyer of my property to pay {$3900.00} in assumption fees prior to submitting the buyers loan application to underwriting disregarding XXXX XXXX, VA XXXX XXXX and their limit of {$300.00} assumption fee charge. Page XXXX, of XX/XX/XXXXXXXX XXXX states the following : ( f ) Assumption Fees : The holder or servicer may charge an assumption processing fee not to exceed {$300.00} on assumptions processed by holders or servicers with automatic authority, or {$250.00} on assumptions that require VA prior approval. This fee is intended to cover all costs of underwriting, processing and closing the assumption. If the loan is disapproved, and the assumption fee was collected previously, the portion attributable to changing the loan records, {$50.00}, must be returned to the party who paid the fee if the loan remains disapproved after 60 calendar days ( to allow time for processing requested appeals ). DMI responded to my inquiry on why they were charging over {$300.00} for assumption fees by stating that it was their banks policy to collect these fees prior to underwriting. Later in writing in response to my FDIC complaint my lender stated that the bank/DMI was correct in charging over {$300.00} in assumption fees due to XX/XX/XXXXXXXX XXXX which allows for the collection of fees exceeding {$300.00}. While XX/XX/XXXX XXXX XXXX XXXX XXXX allow for collecting fees over {$300.00}, it is quite irrelevant to this case as it limits assumption fees to {$460.00} ( see TableXX/XX/XXXX below ). 

Frankly, their reason for charging {$3900.00} is not accounted for by the VA Assumption Locality Variance despite the DMIs claim. DMI also misrepresents closing costs such as the VA Funding Fee as assumption fees and requires payment of these fees up front prior to submitting the assumption application to underwriting. After I contacted the CEO of my lender on my concerns with these fees, there was an attempt by DMI to recall e-mails which requested these fees, in what I believe is an attempt to hide any proof of wrongdoing in regards to these fees. 

2. Regulations on charging closing costs prior to loan underwriting. 38 USC 3729, clearly states that the VA funding fee must be paid to the holder immediately following loan settlement. Based on this, I believe this fee should not be collected prior to loan underwriting as the bank is currently requiring. Reference : ( Authority : 38 U.S.C. 3729 ) ( 2 ) Subject to the limitations set out in this section, a fee of one-half of one percent of the loan balance must be paid to the Secretary in a manner prescribed by the Secretary by a person assuming a loan to which 38 U.S.C. 3714 applies. The instrument securing such a loan shall contain a provision describing the right of the holder to collect this fee as trustee for the Department of Veterans Affairs. The loan holder shall list the amount of this fee in every assumption statement provided and include a notice that the fee must be paid to the holder immediately following loan settlement. The fee must be transmitted to the Secretary within 15 days of the receipt by the holder of the notice of transfer. 38 USC 3712 also states that the funding fee is to be paid at loan closing. Reference : ( Authority : 38 U.S.C. 3712 ; 42 U.S.C. 4001 note, 4012a ) ( b ) A lender may charge and the veteran may pay a flat charge not exceeding one ( 1 ) percent of the amount of the loan less the portion thereof allocated to the manufactured home : Provided, That such flat charge shall be in lieu of all other charges relating to costs of 36.4254 origination not expressly specified and allowed in this schedule. ( c ) Except for a refinancing loan pursuant to 38 U.S.C. 3712 ( a ) ( 1 ) ( F ) or ( G ) fees and charges specified in this section may not be included in the loan. ( d ) ( 1 ) Notwithstanding the provisions of paragraph ( c ) of this section and subject to the limitations set out in paragraphs ( d ) ( 4 ) and ( d ) ( 5 ) of this section, a fee must be paid to the Secretary. A fee of 1 percent of the total loan amount must be paid to the Secretary before a combination manufactured home and lot loan ( or a loan to purchase a lot upon which a manufactured home owned by the veteran will be placed ) will be eligible for guaranty. Provided, however, that the fee shall be 0.50 percent of the total loan amount for interest rate reduction refinancing loans guaranteed under 38 U.S.C. 3712 ( a ) ( 1 ) ( F ). All or part of such fee may be paid in cash at loan closing or all or part of the fee may be included in the loan without regard to the reasonable value of the property or the computed maximum loan amount, as appropriate. In computing the fee, the lender will disregard any amount included in the loan to enable the borrower to pay such fee. 

The VA XXXX XXXX XXXX also states that these fees are due at loan closing ( see below ). Reference :XX/XX/XXXXXXXX XXXX XXXX XXXX XXXX : Borrower Fees and Charges and the VA Funding Fee Topic 8 : The VA Funding Fee a. The Lenders Role - verify the status of any veteran who may be exempt from paying the funding fee ; determine the amount of funding fee owed by any non-exempt borrower ; - collect the appropriate fee from all non-exempt borrowers at loan closing ;XX/XX/XXXX: How to Process VA Loans and Submit them to VA m. Funding Fee - At loan transfer, the purchaser is required to pay a funding fee to the servicer equal to onehalf of one percent of the loan balance as of the date of transfer. See Chapter 8 of this handbook for information on other exemptions from the funding fee and how to verify exemption status. When the transfer is a result of an unrestricted transfer, a funding fee is not required. The fee must be paid to VA within 15 calendar days of the date of assumption using the VA Funding Fee Payment System VA FFPS. The VA funding fee can not be financed into the loan being assumed. It must be paid in cash at the time of transfer. The below paragraph states if the application for ownership transfer is approved, then, the lender must notify the seller of the amount of funding fee to be paid. Once again this shows that the funding fee is not due prior to submitting the loan application to underwriting. 

h. Decision Notices Approvals : If the application for ownership transfer is approved, the servicer must notify the seller and include instructions for the assumption of liability by the purchaser, the amount of funding fee that must be paid, and documentation needed to complete the process. t. Documentation Requirements Processing charges and VA funding fees will be applicable upon transfer. Reference : Chapter 9 : Legal Instruments, Liens, Escrows, and Related Issues Funding Fee Clause A fee equal to one-half of one percent of the balance of this loan as of the date of transfer of the property shall be payable at the time of transfer to the loan holder or its authorized agent, as trustee for the VA. If the assumer fails to pay this fee at the time of transfer, the fee shall constitute an additional debt to that already secured by this instrument, shall bear interest at the rate herein provided, and at the option of the payee of the indebtedness hereby secured or any transferee thereof, shall be immediately due and payable. This fee is automatically waived if the assumer is exempt under the provisions of 38 U.S.C. 3729 ( c ).

3. Regulations on VA Assumption Approval Timeline The assumption process has taken months, and DMI appears to be continuously adding new requirements in order to delay the closing of the assumption for as long as possible. They have repeatedly requested documents they have already received. They also repeatedly ignored questions from the title company who are forced to ask the same questions over and over without receiving an actual response to their questions. The loan assumption should have had approval or disapproval within 35 days of receipt of the loan application ; DMI confirmed receipt of everything needed in XXXX and after that requested assumption fees before proceeding to submit the loan application to underwriting, delaying the loan submission well beyond the required deadline. 

After receiving the requested fees, the bank then asked for the recorded deed which is impossible to get until the assumption agreement is approved further delaying closing of the sale and assumption. VA XXXX XXXX states holders with automatic authority must submit the loan application to the VA within 35 days of receipt. The same circular also states : When a holder willfully refuses to process an assumption package in accordance with XXXX XXXXXX/XX/XXXXand associated regulations, such actions negatively affect Veterans ability to use their earned VA- guaranteed home loan benefits, including selling their home through an assumption. Moreover, such a willful failure to comply with applicable law regarding assumptions constitutes a defense against VAs liability on the guaranty.

DMI had also failed to provide the title company with written documentation of whether an endorsement modification such aXX/XX/XXXXs needed and told me directly that they do not even know what that is. Furthermore, DMI refused to correct their assumption agreement which lists me as single making it impossible for closing to occur as the sale deed and assumption agreement must match which has been explained to them by the title company on over 10 occasions.

DMI has been provided with multiple copies of the deed showing that I am married and have even received my marriage certificate. By not correcting their mistake in the assumption agreement DMI intentionally attempted to stopp the closing and sale of my property by not providing a simple edit of the assumption agreement or written clarification on whether an endorsement modification is needed. 

Furthermore, after my title company received permission to edit the assumption agreement to state I was married from my lender, we were able to close on XX/XX/XXXX. On XX/XX/XXXX, DMI reached out to the title company and asked them to redo the assumption agreement to have my wife 's signature. This is not needed- my wife was never on the loan or the title of the home.

By not processing loan assumption within the given timeframe DMI is negatively and purposely affecting Veterans ability to use their VA home loan benefits. 

4. Possible Truth in Lending Violations DMI had the buyer re-sign his previously submitted loan application in order to circumvent the VA regulations timeline.

DMI never disclosed that their assumption fees nor closing costs needed to be paid prior to underwriting.

DMI attempted to recall previously sent emails in order to obscure written record of asking for assumption fees. 

XXXX. Conclusion Based on my experience over the past 6 months with this mortgage servicer, I think overall their actions show that is engaged in deceptive and discriminatory practices against veterans. 

I imagine these same issues have negatively affected a large number of veteran customers who desire or have desired to use their VA loan assumption benefit. In my opinion, DMI is clearly not following the VA home loan procedures or the federal regulations which govern it and are actively targeting veterans in attempts to effectively deny veterans the use of their VA home loan benefits by charging fees prior to closing and delaying the assumption process as much as possible making assumptions near-impossible for veterans.

The only reason for DMI 's action that I can imagine is that the bank is limited on how much profit they can make through these VA loan assumptions and would much rather force buyers to pay origination fees and higher interest rates on new loans instead of allowing veterans to assume VA loans for low fees at a lower interest rates. 

My suspicion is that DMI along with my lender are actively and purposefully deprioritizing and delaying VA loan assumptions through these erroneous requirements and gross negligence in hopes that any VA loan assumption application submitted will not close in a timely manner or will be unable to close at all through these unusual policies and requirements. 

In delaying and effectively denying these assumptions through their erroneous and illegal requirements, the lender can originate a new loan making the company more profit. In extreme cases these delays can cause the loss of sale and a subsequent foreclosure in which the bank can seize the property and sell for an even greater profit. 

Assumptions are often used as a convenient and easy way for veterans to get out of a loan that they can no longer afford payments on. Therefore, if the DMI 's assumption process takes an unreasonable amount of time ( which from personal experience it does ) I suspect that actions such as this would be a natural consequence. I personally could have been forced into a foreclosure if DMI continued to refuse to cooperate in the assumption process and at the very least would most likely have lost my sale resulting in the personal loss of over {$100000.00} not to mention the costs I have had to hold while waiting for this assumption to close or the time and mental energy I have had to spend to attempt to close on this assumption.

Overall, DMI 's assumption policies and procedures appear to be in violation of CFR and furthermore appear to be intentionally and specifically targeting veterans and their ability to use VA home loan assumption which is a fundamental feature of the VA loan.

Company response to consumer: Closed with explanation