Consumer complaint received 2020-09-04 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: VALLEY NATIONAL BANCORP
State: NY

Complaint narrative:
Started a discussion of mortgage refinance on XX/XX/2020 for the loan amount of $ XXXX, no cash out with a Valley National Bank employee. The primary goal is to achieve a lowest rate since I am at 4.875 % .The nuance is my cooperative building is high sponsorship, therefore, it is typically not FNMA approved. I am aware that many banks because of this will only offer portfolio loans and not loans intended for the secondary market.Therefore, when I reached out to the loan officer, the building not being FNMA approved is the first thing I disclose via e-mail. This is something I will tell upfront to avoid the exact situation Valley National Bank put me through. I was offered 3.25 % 30 year fixed rate mortgage. 

We move forward with the process at good pace, appraisal came in a little lower than anticipated. The loan estimates and application were all based on the offered 3.25 % 30 year fixed. I also agreed to a 0.50 % fee to compensate for the higher LTV. As you can tell, the rate was my primary focus as I'm willing to pay XXXX bps. All seem to be coming together just fine and as I expected. At some point, officer even called and encouraged me to lock the rate which I did without giving it much thought. At this juncture, out of pocket was an application fee of {$490.00}, coop questionnaire and master insurance binder for {$320.00}. On XX/XX/2020 I was notified via e-mail that the loan was NOT FNMA approved due to high sponsorship ( exact thing I told the loan officer ) and the bank is offering a portfolio loan for 3.875 %, bi-weekly payments and ACH setup. Logically speaking, it is very unlikely for a consumer such as myself to spend over a month, disclose all my confidential private information, pay almost a grand upfront for Valley National Bank to confirm that the building is not FNMA approved. I am aware FNMA has a list for approved coop buildings so this was a simple easy checklist item. At this point, it seems to be a classic switch-a-roo. 

I respond to the email indicating how upset I am with the institution. Also noting that I disclosed that it was not FNMA approved at the beginning of the whole ordeal. The banker does not respond for over a week. I take the initiative to e-mail them again summarizing all those points again, decline their portfolio offer and tell them I expect the fees to be refunded. The very next day I get another e-mail stating a refund on the {$490.00} application fee has been processed. At no point did the institution admit oversight or assumed responsibility, provide a reasonable solution or adequate explanation addressing my concerns about this case being a bait and switch or the professionalism of the staff. If I was offered/quoted a 3.875 % 30 year fixed when I inquired, I would have declined and never started the process. I believe this merits some level of attention. We can't have bankers mislead consumers, get them started in the process, and pressure them to close on a higher rate.

Company response to consumer: Closed with explanation