Consumer complaint received 2020-03-22 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: JPMORGAN CHASE & CO.
State: OR

Complaint narrative:
On XX/XX/XXXX, I began an online application to refinance an existing mortgage with JP Morgan Chase. The mortgage is for a duplex that is an investment property, and for which Chase holds the current mortgage. I intended to refinance and take cash out, so I could pay off a HELOC on my primary residence. 

On XX/XX/XXXX, I received and email from XXXX XXXX, the loan officer assigned to the application. I accessed the online portal and began uploading documents. I clearly stated to XXXX ( and this will be documented in recorded phone calls ) that the property was a duplex - and old house converted to 2 units - and provided all  documents ( including two rental agreements ) that confirmed it was 2 units. XXXX stated that it would still be considered a single family home, because it was a single physical house. 

On XX/XX/XXXX, I received confirmation that the loan was submitted to underwriting. 

On XX/XX/XXXX, I logged into the online portal to check the status, and saw a note stating that the underwriter needed additional information about the second unit, and that the second unit was not disclosed on my application. I immediately emailed XXXX ( cc to XXXX XXXX, who had sometimes stepped in on my application ) to ask about why I was receiving this note, when I had clearly disclosed the information. XXXX stated in email and in a phone call that he was the one who made the mistake ; he did not understand how a 2-unit property should be handled, and that he would work with his team to resolve the issue. He stated that the lending estimate that I had been given would now be wrong, because a 2-unit loan would have higher rates and fees. 

At this time, I began asking XXXX to provide a new a new loan estimate, so that I could review and decide if I wanted to move forward with the loan. On repeated phone calls and emails, he assured me that he would get these to me ASAP, but I never received them. 

In early XXXX, the appraisal on the house also came back slightly lower than our initial estimate. In a lengthy phone call, XXXX explained that the max LTV for a 2-unit property was also lower than a single family property, so I would no longer be able to take out enough cash to pay off my HELOC, unless I brought significant cash to closing. I told him that I would be interested in taking out the max cash possible, paying off the bulk of the HELOC, and that I would still be able to cover the remaining HELOC payment. ( My own personal debt to income ratio is quite low ... I was not at risk of disqualifying because of that. ) He said that he understand, and would re-run the loan that way and send me new disclosures. I never received them. 

On XX/XX/XXXX, I emailed XXXX and his supervisor, XXXX XXXX, to formally complain about the delay in the application. I received the following response : " You have been very understanding. For this, I have submitted a request to refund your {$500.00} Good Faith Funds at this time in an attempt to make things right. Do be aware that since the funds were used for the appraisal, the refund may have tax implications. I will keep you posted and notify you of the results of the request. '' I emailed in response, asking if this meant my application was being cancelled. I received no response that day or at any time since then. 

On XX/XX/XXXX, I received a form letter letter from Chase : A Statement of Credit Denial, Termination or Change. It notes that my application was denied because of 1 ) " Value type place or condition of collateral insufficient or unacceptable '' ; 2 ) "  Insufficient funds to consummate the transition. '' Neither circumstance is accurate. 

I have also not yet received a refund of the application fee. 

This loan ( as it was originally disclosed ) would have cost tens of thousands less than my current mortgage. I am now out the {$500.00} application fee, countless hours of time, and thousands of dollars in future interest because Chase provided inaccurate information, ignored repeated requests to provide updated and accurate information, wrongly denied my loan application, and failed to remedy the situation when I tried to work with them directly.

Company response to consumer: Closed with explanation