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Chase Mortgagerefinacing process

M

On March 26, 2009 we applied for a refinancing loan with Chase our current mortgage company. Our credit score is 800. We submitted all the documents the loan officer requested the next day. We were preapproved for a 4.873%interest rate on $567, 000 loan. We currently pay $300-$400 extra every month towards the principal since we bought the house 4 yrs ago. We never missed a payment. I had to give them a check for $ 750 and they would lock in the rate for 60 days. He (Mac-loan officer) did say that if the bank delayed the process then the rate would still be locked in past the 60 days. Also if they declined us we would get the $750 back.


On Sept 23 we were declined for the following reason: "We got the Final Review done with Underwriting. And they have Final Declined your loan application.

Here are the exact words of the Underwriter;

"The maximum DTI "Debt to Income" with all the mortgage insurance companies is 41%. The DTI for this loan is 44.26%.

I am sorry but the loan cannot be approved. Mortgage insurance is not available when the DTI exceeds 41% and there are no exceptions from the mortgage insurance companies. Also, since the CB will have future loss carry overs per their accountant letter but dollar amounts are not estimated, it is impossible to accurately determine their income."


Comment from the loan officer- (who could not even explain the declination)

"Maureen, this is a direct result of the Lower Appraised Value that increased you initial LTV "Loan to Value" to a higher 85%. As you know the appraised value came in lower than expected at $670, 000 & the file had to be restructured within LTV guidelines. If this was under the 80% LTV Limit then the maximum allowed DTI would have been 45%. Due to the ratios above 41% DTI we are unable to obtain MI Mortgage Insurance coverage for your loan. The only possible solution to obtain an approval would be if you decided to reduce your principle loan balance to be under 80%. I would estimate would be $33, 500 Plus Closing Cost would be roughly around $40, 000 out of pocket, that would reduce your final DTI to be close to the maximum allowed 41%. Of course this figure would need to be confirmed by underwriting.

We are unable to offer the applicant credit for the following reason(s):

Adverse Action Reasons


1. Excessive Obligations in Relation to Income (44.26% above maximum 41% per MI )

2. Unable to Verify income


We submitted our tax returns and our bank statements 3 times because they lost them the previous 2 times- that is even a bigger concern.


I called the bank every week for an update for 6 months. Then we went on vacation which I informed them of weeks in advance and they told me the day before vacation we had to have our CPA explain why my husband sold his business 3 years ago. Also they said I wasn’t employed but I provided my W2's for the past several years.

Our income is way above the ratio they mentioned. We could pay off the mortgage if we wanted to, they didn’t mention that fact in the denial.


How can they get away with this on so many loans? Even our loan officer told us we were one of many they were doing this to and he was very frustrated. This is their own employee agreeing with this unprofessional, discriminatory way of how they are treating their customers.


Issues:1. Lost our tax returns twice which cause me major privacy concerns.

2. Applied 3/36/09 did not hear anything from loan officer unless I initiated the emails or phone calls. The bank manager at time would not get involved, which caused even a longer delay.

3. Since they took so long to get an appraisal on our house (6 months from application date) the housing market declined.

4. The comment about not verifying income is absurd since we provided our W2's three times and our bank statements. We have no other debts and if they bothered reviewing instead of just taking our money and delaying the process they would have noticed how much we have in the bank. Now we cant apply anywhere else for several months because of the appraisal.

The last insult was that we are only getting $350 back of the application fee even though they turned us down. The reason is debt ratio to income- another way of saying they are keeping our money. This has to constitute fraud or misrepresentation!! We were guaranteed our money back if they declined us for any reason!

Responses

  • Ve
    Verdad Oct 11, 2009

    I may be able to assist you; if you are comfortable doing so, please provide your email.

    0 Votes

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