Megastar Financial Corp

This statement is being provided in response to compliant ID #[redacted] filed by Mrs. [redacted] against [redacted] and MegaStar Financial Corp. Mrs. [redacted] alleges [redacted] of Megastar Financial stated he would “enroll us” in the Golden State Finance Authority Mortgage Credit Certificate....

Mrs. [redacted] goes on to state in her compliant that she was told by [redacted] that she “did not have to fill out the application and that it would be taken care of for us”. [redacted] denies that he made this statement. [redacted] and MegaStar Financial have assisted many borrowers with their MCC applications in conjunction with a 1st mortgage originated by Megastar Financial Corp. Mrs. [redacted] has provided nothing in writing to substantiate her allegations regarding said statement from [redacted]. The Golden State Finance Authority website outlines the borrower must complete the application. The exact verbiage from the Golden State Finance Authority website is as follows: “Homebuyers apply for the GSFA MCC through a Participating Lender. The Participating Lender will perform an initial qualification and assist the homebuyer in completing the MCC submission forms. The Lender then submits the MCC application at the same time the loan application is submitted for approval.” Mrs. [redacted] states that she was made aware of the $300 application fee to process an MCC application through Golden State Finance Authority. How did Mrs. [redacted] know about the $300 application fee yet fail to understand the application process? Mrs. [redacted] was provided and signed loan disclosures on 5/20/2015. These disclosures included a Good Faith Estimate and Initial Fees Worksheet both of which provided detail on all fees to be charged on the transaction. There was no reference to the MCC application fee or any fee paid to Golden State Finance Authority on these disclosures, which should have probed a question or inquiry from Mrs. [redacted] to ensure that the application for the MCC was included in the estimate provided. Mrs. [redacted] was again provided a complete list of settlement charges in the form of a HUD-1 settlement statement prior to closing. Again there was no reference to an MCC fee or any other fee paid to Golden State Finance Authority on the HUD document, which again should have prompted Mrs. [redacted] to inquire about an application for an MCC. Lastly, Mrs. [redacted] states that in closing her complaint, that it is “their job” in reference to the completion of the MCC application by the lender. Again as referenced in the program website, a lender cannot apply on behalf of a borrower, and therefore the borrower’s cooperation in the application process is required to complete the processing of the MCC. The lender may assist the borrower in processing their application for an MCC through the Golden State Finance Authority, but cannot apply on the borrower’s behalf as the consumer implies in her complaint. A review of the required forms to process an MCC through the Golden State Finance Authority would evidence that forms MCC-003 (Application and Affidavit), and MCC-008 (Borrower’s Closing Affidavit), are required to be completed and signed by the borrower. Without the borrower completing the above referenced documents, the MCC cannot be provided. In closing, MegaStar Financial does not wish to have a disgruntled customer. Therefore as a gesture of good faith, we made an offer to help offset some of the potential lost tax credit. The consumer did not accept the good faith offer and refused to acknowledge accountability, and rather continues to pursue a an unreasonable settlement amount based on assumptions regarding length of home ownership, and other factors that determine the actual value of the presumed tax credit. MegaStar Financial does not accept responsibility for the borrower’s failure to complete the required MCC application documents, and has not agreed to the proposed settlement by the consumer. Sincerely, [redacted] Sales Director AVP Megastar Financial Corp.

Review: I was told that Megastar Financial would enroll us into the Federal Program Golden State Finance Authority Morgage Credit or MCC to give us a 20 % tax credit at the end of each year for the life of our new FHA home mortgage. We were told we did not have to fill out the application and that it would be taken care of for us (I asked this specifically to make sure I did not need to do any research on my own) as long as they submitted it prior to the close of escrow we would be good to go. He told us it cost 300.00, we said no problem we'll pay it. He told us what our closing cost would be at the end of this conversation. I thought it included the $300.00 so when we closed escrow and the amounts matched what he had given us in the office I thought we were good. I called the office after escrow closed to see if they had paperwork on the MCC program for us. They told me they forgot to fill out the papers for us and that it was too late to enroll us. This was huge shock for us, knowing we were suppose to get back $1897.00 per year for at least the first 15 years then it would drop as interest was paid off for the remaining 15 years. Their corporate office told us it was our fault, we should have filled the paperwork out and submitted it ourselves and that they are not responsible to fill out the Federal Programs paperwork for us. As of yet, they will not compensate us for the $40,000 plus loss we will endure because of their incompetence. I asked them if I should fill the paperwork our myself the day we signed our initial papers, they told me NO "they would take care of it all for us"....Look what happened because we trusted them to do what they told us they would do. Now we are the ones out the money while they keep raking it in. I have in writing where we were told by the company manager that they forgot to fill out the paperwork (they got too busy with the escrow). Interesting, isn't it, since that's their job.Desired Settlement: We would like to be compensated for the money that would be paid to us as if we were enrolled into the MCC program. It's 20% of the full interest paid a year for the life of the loan.

Business

Response:

This statement is being provided in response to compliant ID #[redacted] filed by Mrs. [redacted] against [redacted] and MegaStar Financial Corp. Mrs. [redacted] alleges [redacted] of Megastar Financial stated he would “enroll us” in the Golden State Finance Authority Mortgage Credit Certificate. Mrs. [redacted] goes on to state in her compliant that she was told by [redacted] that she “did not have to fill out the application and that it would be taken care of for us”. [redacted] denies that he made this statement. [redacted] and MegaStar Financial have assisted many borrowers with their MCC applications in conjunction with a 1st mortgage originated by Megastar Financial Corp. Mrs. [redacted] has provided nothing in writing to substantiate her allegations regarding said statement from [redacted]. The Golden State Finance Authority website outlines the borrower must complete the application. The exact verbiage from the Golden State Finance Authority website is as follows: “Homebuyers apply for the GSFA MCC through a Participating Lender. The Participating Lender will perform an initial qualification and assist the homebuyer in completing the MCC submission forms. The Lender then submits the MCC application at the same time the loan application is submitted for approval.” Mrs. [redacted] states that she was made aware of the $300 application fee to process an MCC application through Golden State Finance Authority. How did Mrs. [redacted] know about the $300 application fee yet fail to understand the application process? Mrs. [redacted] was provided and signed loan disclosures on 5/20/2015. These disclosures included a Good Faith Estimate and Initial Fees Worksheet both of which provided detail on all fees to be charged on the transaction. There was no reference to the MCC application fee or any fee paid to Golden State Finance Authority on these disclosures, which should have probed a question or inquiry from Mrs. [redacted] to ensure that the application for the MCC was included in the estimate provided. Mrs. [redacted] was again provided a complete list of settlement charges in the form of a HUD-1 settlement statement prior to closing. Again there was no reference to an MCC fee or any other fee paid to Golden State Finance Authority on the HUD document, which again should have prompted Mrs. [redacted] to inquire about an application for an MCC. Lastly, Mrs. [redacted] states that in closing her complaint, that it is “their job” in reference to the completion of the MCC application by the lender. Again as referenced in the program website, a lender cannot apply on behalf of a borrower, and therefore the borrower’s cooperation in the application process is required to complete the processing of the MCC. The lender may assist the borrower in processing their application for an MCC through the Golden State Finance Authority, but cannot apply on the borrower’s behalf as the consumer implies in her complaint. A review of the required forms to process an MCC through the Golden State Finance Authority would evidence that forms MCC-003 (Application and Affidavit), and MCC-008 (Borrower’s Closing Affidavit), are required to be completed and signed by the borrower. Without the borrower completing the above referenced documents, the MCC cannot be provided. In closing, MegaStar Financial does not wish to have a disgruntled customer. Therefore as a gesture of good faith, we made an offer to help offset some of the potential lost tax credit. The consumer did not accept the good faith offer and refused to acknowledge accountability, and rather continues to pursue a an unreasonable settlement amount based on assumptions regarding length of home ownership, and other factors that determine the actual value of the presumed tax credit. MegaStar Financial does not accept responsibility for the borrower’s failure to complete the required MCC application documents, and has not agreed to the proposed settlement by the consumer. Sincerely, [redacted] Sales Director AVP Megastar Financial Corp.