What they did to us, they're doing to others. It's a pattern of conduct, and it's hurting homeowners across the nation.When interest rates dropped in early 2013, we decided it would be a good idea to refinance our house. Our current mortgage represents about 18.5 percent of the value of our home. Not a huge balance. Rates were low, and we decided it was a great time to pull some money out for long-needed repairs. In particular, we had a master bathroom that had been torn out down to the studs which we needed to renovate.
We also have a daughter in college and so a refinance to a 30-year fixed rate mortgage that would have set our debt to about 30 percent of the value of our home would also have reduced our payments by about $300 per month, which would ease cash flow needs for the college expenses. We could pull enough money out with those numbers to renovate all of the bathrooms, the kitchen, and redo the floors.
Overall, it seemed like the time was right. But Wells Fargo thought otherwise.
We initiated the process in April. In May the appraiser came out and did the most thorough appraisal I've ever seen done. She took pictures of everything, including the gutted master bath. Just after that, we received a notice of conditional approval which also told us we should start putting together a lot of paperwork so the underwriter could move the application through rapidly when our processor requested it. We did that.
The processor didn't request anything from us until June 10th, with our rate lock expiring on June 25th. We sent all of the paperwork in via electronic means to expedite what we thought would be a rubber-stamp approval. After all, we thought, we're not exactly irresponsible borrowers, nor are we borrowing anything close to the value of our home.
I should tell you here that the only reason we even received a request for documents was because we followed up with the processor. He did not ever call us or request anything without us asking him what they needed, and this was the first occasion among what would become many where a phone call from us sparked a frenzy of documentation activity from them. If we hadn't called, I'm sure they'd have just let it die.
On June 24th, the rate lock was extended to July 9th so we could supply more documents the processor didn't request.
On July 9th, the lock was extended to the end of the month so we could yet again produce more documents relating to our homeowner's association fees and insurance.
I was convinced that Wells Fargo had no intention of approving this loan by the time the second rate lock was in place. I was convinced they had no intention of refinancing for a lower interest rate with cash out, but would instead find any excuse they could to decline it. My husband was willing to offer them more of the benefit of the doubt than I, attributing the delays to processor incompetence more than intent, but I was already seeing story upon story about how people were being shut out of loan approvals during low interest rate periods. This isn't incompetence. It's a pattern of conduct.