If you are considering USAA for your mortgage, please read this post.

Regular Contributor

Like many of the posters here I regret not having read these boards before moving forward with USAA on my home purchase after 20 years of membership.  What follows is a description of the problems that have yet to be resolved 12 days from closing(July 2nd), and 21 days from starting this process.  But first I want to say that I am a mortgage expert, I have spent 20+ years in finance, and 15 years in the mortgage industry, and know the difference between isolated issues and deep rooted problems.  I see the latter, but draw your own conclusions.  I have higher standards than most when it comes to this area, but not unreasonable by any stretch.

I picked USAA for a few reasons, first off their PMI rate at 10% down is .025%, which is half the industry standard, which to me is like a free loan of sorts. I will spare you the math, but simply put you can keep half that down payment and not get hosed in PMI payments.  Second factor that made me pick USAA was the recast options.  I am selling my current home, expecting to net $50k or more and I can use that to pay down on the pricipal and lower my payment at any time for the lifetime of the loan.  FInally the reputation and past experience with USAA has never failed me.

 

This is a fully documented convertional loan, plain vanilla.  The wife and I have at least 3 years with current employers, 700+ credit, assets etc.  We sent USAA double all the docs they wanted,  asked for last 2 paystubs, they get 4, asked for 2 years w2s, they get 4, same for assets etc.  I want them to have it all up front, not wanting to play the "missing information" game.  I know the typical causes of delays, I want to avoid them all and provide every bit of info that will make the process as smooth as possible.  Paid the appraisal fee on day one.  Preapproval goes off without a hitch, already in contract from day one, they get all the docs.  So far so good through week 1.

 

Week two I get notice that the loan can not proceed as the DTI did not meet the requirements.
Regarding the calculation of my income: For the the record, I explained to Yasmel my first loan officer at the inception that I have additional income in the form of a monthly bonus. However, based on her review, we got a green light on the DTI calculation in the automated underwriting check at the time of application  (5/30/2018) based on just my and my wife's base salaries from the start, she took it upon herself not to include the bonus income($600+/mo). This being the case I am not sure what changed from that conversation to the 2nd week, but if anything my income was understated at the start and it being higher than my base should have been apparent once my W-2's and payroll documents were reviewed.  If there had even been even a small concern that the DTI would be an issue should a full verification been done up front, or should at least someone at USAA asked me to provide details of my bonus structure?  Also, why was the DTI not an issue at the first point that the underwriter was reviewing the application(6/6/2018) instead asking for other unrelated documentation?  Would this not have been an issue right out of gate and been part of the first set of matters raised at that time?  I am certain they were aware of the additional income because on or about June 6th I spoke to another loan processor at USAA who read over the phone notes from the UW regarding needing explanation about why I had more pay in my checks than my base salary would suggest I should. However, those notes never materialized into a question posed to me, and that may have been an opportunity to clarify and avoid delay as asking that question a week ago would have been more timely and given me a reason to reconsider my pending expenses related to this transaction.  So in the third week of the process they want to do a VOE/VOI, which is great, but they should have ordered that right out of the gate instead of waiting until there was an reason.  Their processes are reactive instead of proactive, and they are unable to communicate effectively both internally and externally.

Regarding the appraisal:
Today is the 21st day since I paid the fee.  It has been 15 days since I agreed to pay double the original fee disclosed, and guess what?  We still have no appraisal, 12 days from closing.  There is no accoutability in their process, escalations seem to go nowhere.
Back story: I was very clear up front regarding the size of the property(22 acres) and my concerns that it could qualify for a conventional  mortgage product USAA could offer, but also the appraisal cost.  At first it appeared my concerns seemed unfounded as the loan made it through the application stage and when asked to provide payment for the appraisal I specifically inquired in depth about the cost because I have had past experience which led me to believe that the appraiser might charge more for certain properties.  I was assured that the fee was going to be $525, period.  Then 6 days later I was advised that the appraiser was doing exactly as I had feared and increasing their fee based on the size of the property and/or its location.  I would not have agreed to pay $1050.00, (double the fee initially disclosed), had I even been remotely concerned that the DTI calculations were an issue, I would have resolved those concerns up front before costs were incurred.  However based on the information that had been provided to me at that point I did not feel the additional cost was a huge issue and agreed to pay the difference at closing.  I have also would not have spent money on a home inspection, WDO inspection, septic inspection, and wind mitigation report if I had any indication that the DTI was a concern.  Now I am out of pocket to the tune of $1200, with a $750 survey still pending the very late appraisal. 

In summary, I have provided specific verbal information and written documentation that USAA has either not bothered to note or simply ignored altogether.  I have asked specific questions based on valid concerns, having USAA reassure me would not be an issue, and then be told the exact opposite days later.  I feel that I have been as proactive, flexible, forthcoming and responsive as I possibly could be in this process, but I don't feel that I am getting the appropriate level of communication and service that I have come to expect from USAA based on my experience after 20 years as a member.
 
Based on the experience so far, and my past experience with Quicken Loans, New Penn Financial, even Wells Fargo, I would recommend looking elsewhere for your mortgage needs.  It's a terrible feeling having to go back to every person I ever steered to USAA over 20 years and tell them I was wrong, but that's where I am at this point.
 

I am still committed to this process, and look forward to working through these issues with their team. I would appreciate a call from member of management at USAA regarding these concerns and I can be reached on my mobile number in my profile at almost any hour. 

8 REPLIES

Update:

 

USAA has reached out to me via their member advocacy team, the process seems to have tightened up a little in theory, but proof is in the pudding.  We remain commited to this process.

Day 25 and still no appraisal.  We are supposed to close on 7/2 but that seems unlikely given USAA's performance so far.  On Friday they asked me to provide proof that I pay all my cards off each month.  Seems pretty late in the game, but I provided what they asked for.  Had to send in another paystub for my wife, even after the full VOE they did for her.  The aggrivating thing is that this all should have been done in week one, not late in week 4.  We have a backup plan with 2 other lenders should USAA fail to give me the appraisal in the next 48 hours, and I guess I will join the line of former members finding greener pastures.

Thank you for the update @lawnarjax, I will be sure the appropriate area receives these details, please let us know if anything else is needed.-Emily

Update:

 

Day 26 since appraisal fee paid, and still no "approved" appraisal.  Apparently once USAA gets an appraisal they won't just accept it on face value, it must go through an internal review and approval process before being used in the loan approval process.  It seems with the regulatory changes that went into place after the meltdown, this internal review runs counter to the spirit and intent of the law.  The whole reason for the new laws, and the appraisal management companies existance, is to remove the lenders influence, and have the appraisal process be independent.  When USAA explained to me a few days ago that the appraisal had been completed, and they had it in their possesion, but it was not "approved" I was surprised by this additional process.  In my opinion they have essentially circumvented the appraisal regulations by placing another layer of approval into the process.  They should not be underwriting the appraiser, as long as the AMC is doing their job the opinion of value should be what it is.  If USAA is not satified with the methods used then they need to order another appraisal from another AMC, not massage the one they get until it meets their needs or says what they want it to say.  This really puts this process back into the pre-meltdown era, where lenders were driving the opinions, and appraisers were just part of their process, not independent as they should be.  I just need to know what the appraisers opinion is, good bad or neutral, I need an honest opinion of value, not what USAA approves of its value to be. 

 

Anyhow, we are less than a week from the scheduled closing date, and USAA has managed to take this long to not get a value.  I have spoken to a few managers, an advocate, and all seem to want to help, but nobody seems to be able to fix the broken cog in this machine.  I am now guessing as to when or if to order the survey, schedule the moving equipment and movers, transfers of utilities, all the stuff that also needs to happen is now just waiting for USAA to do it's job.

@lawnarjax, While we understand your frustration, we ask that you refrain from additional posts about the situation. As this is seen as "bumping" contentthat is to say, posts that serve to repeat existing issues. Please look to our "Posting Guidelines" on our "About" section. Future posts regarding the same issue will not receive a response and are subject to removal from our wall. While it is our intention to never ban individuals from our page, if a violation of our guidelines is clear, we will remove the content and block the individual. Thank you for your time. - Robert

Robert, if a new and never before mentioned issue has come up today would posting about that violate the TOS?  Can I make a new thread about the new issue without violating the TOS?  I feel obligated to share my experiences throughout the process.  Please advise. 

Well at the risk of being barred from further posts I will give some good news.

 

The appraisal finally did come in.  Right on the money too, so great news there.  I appreciate the help from people who stepped in to get this part done.  Kudos to USAA loan officer  and and Manager , they essentially saved this whole thing from falling to pieces.  Put these people in charge and things may improve. 

 

 

'Post edited for employee security'

Hello @lawnarjax, that is wonderful news to hear! I am glad we were able to get you situated, CONGRATULATIONS again on your new home :)

 

#USAAMEMBERSROCK!

Hi, would it be possible for you to tell me who the AMC (appraisal management company) is on the appraisal you mentioned? I'm a certified appraiser myself and I'd be interested in finding out. The AMC is the entity listed as the "client" on the signature page of the 1004 form. It might just say "USAA" and also have USAA as the lender, but it may be a different name altoghether. I'd really appreciate it.