LoanDepot.com Gave every indication we were approved for a home loan; cancelled approval 10 days prior to closing. Foothill Ranch, California

I no longer work at this company and I just ran across this posting.  I remember this customer even though it was 4 years ago.  And while her post is not a complete lie, it certainly is not 100% accurate.  I had been in the industry about 15 years when she applied.  Just about anyone in my industry is aware that there is no way we would tell a commission income applicant at a new job that they automatically qualify for a loan.  We give the applicant all of the information – good and bad – and then let them make the decision.  But we are NOT supposed to discourage someone from applying - it’s a violation of Regulation B to do so.  When you tell someone both the good and bad information, I guess its human nature that they tend to hear only the good.  However, I understand her frustration. Purchasing a home can be both exciting and stressful.  Emotions can run high.  But this is not a reason to ignore the guidelines that have been put in place to protect the consumers.  Yes, the lenders are also trying to protect themselves, but the lenders’ safety is definitely not the priority. 

Think of what might have happened if we just gave her the loan with no regard for her ability to repay it.   She wrote about the money that was spent on an inspection and a home appraisal.  But what happens when you can’t make payments anymore?  How much would it cost to uproot your family from a place you’ve called home for several years?  How about receiving collection phone calls and letters from the lender every day?  Or coming home to notices taped to your front door?  How about the humiliation of moving while your friends and neighbors watch?  What about being forcibly evicted by local law enforcement?  Would you rather go through that heartache, or just pay for an appraisal? 

I worked for Loan Depot for over five years.  It’s a great company.  I left to start my own business, not because the company was bad.  I know that they do whatever they can to approve loans.  But not everyone qualifies, that’s just the way it is.  The reason why she was “never refused for a mortgage” in the past is because she never tried to acquire a mortgage after Dodd-Frank.  And in accordance with the Home Valuation Code of Conduct, lenders cannot choose the appraiser; they just facilitate it being ordered.  Again, the new rules were put in place to protect the consumers, not the lenders.  I hope that her husband’s job worked out and that they finally purchased the home that they wanted.