Consumer complaint received 2025-02-23 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Trying to communicate with the company to fix an issue while managing or servicing your loan
Company: GUARANTEED RATE INC.
State: IL

Complaint narrative:
In XXXX, I began researching options to purchase my first home, aiming to buy a property with renovation potential to increase its resale value. After consulting with Guaranteed Rates renovation team, I was referred to a contractor who assured me he had the expertise needed to handle the complex XXXX mortgage process, in which a renovation budget was built into the XXXX style mortgage whose total balance reflected the value of the home after the renovation. Upon meeting that contractor, he told me that he was also a realtor. Despite some concerns about a potential conflict of interest with that of the XXXX also being the realtor, I proceeded with him, believing I was minimizing my risk. 

In XXXX, I purchased a home in the XXXX neighborhood of XXXX. It did not fit my primary criterial of having a garage for my electric vehicle nor did it have a potential space to create an XXXX property for passive revenue generation, but the contractor assured me that with the adjacent vacant city lot that I purchased with the home that I could build an attached garage with a single dwelling unit by XX/XX/XXXX. Despite the time delays I would've likely experienced due to the pandemic that hit right after my closing, at no point in the process was this general contractor was not doing the right things to ensure that completion date would've ever been met. He was taking advantage of his knowledge of the process and myself. As early as XXXX, I was raising flags with the team at Guaranteed Rate that things didn't appear to be going as they should. I never received a recommendation or support. I called and emailed them at least XXXX times. 

In XXXX, I was forced to pause the project and enter arbitration due to financial disputes with the XXXX, who eventually sued me and placed an invalid lien on my property. While Guaranteed Rates attorneys removed the lien, I still incurred significant legal costs and was unable to access my renovation budget. 

Fast forward to XX/XX/XXXX, after working out a settlement with the contractor, I sought to continue the renovation by becoming my own general contractor. However, Guaranteed Rates renovation team decided to return my loan balance to my principal, preventing me from using it to finish the work. This decision not only contradicts the agreed-upon terms but also places a financial burden on me. The current appraised value of my home exceeds the loan amount, eliminating any risk to the bank, yet this action would significantly raise the cost of completing the project due to current interest rates. Although the return of the loan balance improves my loan-to-value ratio, retaining the same monthly mortgage payment reduces my disposable income, making it nearly impossible to take out a new loan to finish the renovation. I could of course refinance to lower the payments, but at todays rates, would still be paying more on the life of the loan. 
I am reaching out to ask for help in resolving this situation, as it has had a devastating financial impact on me. I bought in a good neighborhood at a good time, and unfortunately, got involved with some not good people. I do not want to have to move, but Guaranteed Rate has also made it expensive to stay. I am seeking a fair solution to complete the work, based on the original terms and without further financial strain. I have reached out to the team and the CEO multiple times since then with no response. I truly believe that I need the power of a larger organization to get Guaranteed Rate to respond and take action.

Company response to consumer: Closed with explanation