IMPORTANT INFORMATION ABOUT HOME EQUITY LINE OF CREDIT
REDUCTION OF YOUR LINE OF CREDIT
The letter starts out with the first lie, "Citibank, N.A. is committed to each of its mortgage customers and to helping each of our homeowners with their financing needs."
Citibank froze the LOC of all customers based on and arbitrary computer model that showed their home had dropped below some value which they would not share with me.
HERE IS THE RUB: If you want them to reconsider the freeze on your account, and POSSIBLY have them reinstate your LOC, you have to hire their exclusive appraiser (LSI) at your cost.
When you call LSI (866-612-9276), you will learn that appraisals are provided on the following schedule:
Now I can only imagine that Citibank gets a handsome kickback from LSI in exchange for being the exclusive appraiser....HOW DO YOU SPELL "SCAM"?
SO...Let's say you pay for this SCAM appraisal....Citibank underwriting will not even tell you what Loan to value (LTV) ratio they will give you. For example, if your appraisal comes back at $2M, you have no idea if they will give you up to $1.3M (or 65% LTV) or $1.4M (70% LTV). It is a complete crap shoot at the whim of some bean counter that couldn't figure out how to get it right the first time.
I am so completely disgusted with Citibank that without any regard for their "customers" decides to freeze accounts and potentially screw up the credit of tens of thousands of families. Unlike so many others, I am lucky I didn't bounce any checks or that I am not in the middle of a construction project.
REDUCTION OF YOUR LINE OF CREDIT
The letter starts out with the first lie, "Citibank, N.A. is committed to each of its mortgage customers and to helping each of our homeowners with their financing needs."
Citibank froze the LOC of all customers based on and arbitrary computer model that showed their home had dropped below some value which they would not share with me.
HERE IS THE RUB: If you want them to reconsider the freeze on your account, and POSSIBLY have them reinstate your LOC, you have to hire their exclusive appraiser (LSI) at your cost.
When you call LSI (866-612-9276), you will learn that appraisals are provided on the following schedule:
- Below $500,000 => $350
- up to $1,500,000 => $550
- $1.5M to $3M => $750
- Above that you will be quotes a price
Now I can only imagine that Citibank gets a handsome kickback from LSI in exchange for being the exclusive appraiser....HOW DO YOU SPELL "SCAM"?
SO...Let's say you pay for this SCAM appraisal....Citibank underwriting will not even tell you what Loan to value (LTV) ratio they will give you. For example, if your appraisal comes back at $2M, you have no idea if they will give you up to $1.3M (or 65% LTV) or $1.4M (70% LTV). It is a complete crap shoot at the whim of some bean counter that couldn't figure out how to get it right the first time.
I am so completely disgusted with Citibank that without any regard for their "customers" decides to freeze accounts and potentially screw up the credit of tens of thousands of families. Unlike so many others, I am lucky I didn't bounce any checks or that I am not in the middle of a construction project.
6 comments:
Thanks for speaking out about this. No telling how many folks have been cut off at the knees by Citibank!
Yes thanks for speaking out about this...I just bounced a 1000 dollar check because of it. Do you have a valid number at Citi that one can call? I'm trying every number I have and everything is automated, and I can't even get online access to my HELOC info. I really think they don't want people to have accurate information at their fingertips, because inaccurate info means more money in their pockets.
As soon as possible I will get rid of my Citi HELOC entirely and never do business with them again. They've been nothing but trouble from the beginning.
Hi Steve, This just happened to me yesterday (5/19/08) in relation to my Chase Bank HELOC. They reduced my line by 40% to just above my outstanding balance. This line was just increased last year after an appraisal done by Chase itself. Now I have to hire a private appraiser to challenge the reduction. Luckily, they are not requiring I use "their" appraiser. In fact when I called Chase they said they are not permitted to recommend one. I'm still left doubting whether it will work, since Chase does not guarantee restoration of the credit even if my appraisal is where I think it should be. I would not hire an appraiser required by the bank, that's an obvious conflict of interest problem. I would go to another bank or credit union and apply for a new HELOC and ask them to buy out your old one. That's what I'm considering at this time.
This happened to me today! We never even used the line, and have had it open for 6 months. Now it is suspended, and if we want to cancel we have to pay the closing costs because we were canceling prior to 3 years! So I can't use it, I can't close it, I can't get any info to support the decline of my home value.
I hope someone decides to put together a lawsuit. . .I would be more then happy to contribute my closing costs to the fund.
Kristen - NY
If your HELOC or home equity line of credit was frozen, you may have other options. One option would be to contact a class action attorney:
http://www.classactionconnect.com/?q=node/751
Another option would be to make your HELOC and home equity line of credit complaints public by blogging about them:
http://heloc-complaints.com
This very same thing happened to me a couple of months ago. Citi lowered my limit from $154k to $35.5k overnight. I owed them 5 dollars less than the new limit at the time. Talk about handcuffed. Luckily, i had a small savings account that i was able to draw from to cover the 3 bounced checks and the cost of the appraisal thru LSI. The appraisal came back in my favor and I received the notice (oct. 1) that my limit was being raised back up to what is was originally. The letter also stated the refund for the cost of the appraisal would be sent to me "very soon". It's now Nov. 2, and i have received no refund. Called today, spoke to a supervisor, who stated I would hear by Nov. 7 when to expect the check. I got here name and number, I'll be calling on Nov. 7 for sure. I have been confronting Citibank supervisors with the truth of what their company is up to with every phone call i've made and letter I have written. Of course, it's a coincidence that MY refund falls thru a crack. I'd love to stick it to these crooks.
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