So, back in September, I got a great mortgage re-fi deal from a broker in San Jose...initiated paperwork...and then another one (local) came along and offered a slightly better deal (a difference of 0.125 % actually) and I decided to switch.
Crazy back and forth regarding paperwork ensues...like, can you sign again this time without date or sign again with yesterday's date....along the way, he asks me to pay for appraisal which he said would be re-imbursed at the time of close/settlement.
Weeks go by, then he says impound account is part of the deal....I question that...so he says it will cost $400 extra ....I agree to impound account...don't wanna pay extra.
My home insurance is paid up to Feb and I tell him I plan to shop around and change then...he says change it now...which I do...and then - on Friday Nov 19th, he says the title guy is gonna come to my house to sign the paperwork...
And then, on Monday (Nov 22nd) he says the rate lock expired and since the bank did not receive the new insurance company's paperwork thus couldn't come and now we have to wait for the rates to come back down...the guy never warned me even once that the rate lock would expire. He just kept stringing me along for over 2 months with something or the other.
At worst - the broker weaned me away by offerring cutthroat rates, had me pay to the appraiser (may be getting a cut on that) ... then throw in another $400 on pretext of impound account...which means he's a crook.
At best....he is absolutely incompetent and his incompetence prevented me from getting a lowest possible rate....
Is there any way I can take him to dunno-where (court may be)- get him written up, slapped on the wrist...have my appraisal money refunded...and be compensated for the lost opportunity? Could I sue the bank as well for perpetrating such a nasty joke?
Do I Have A Recourse
Started by
Folsom Guy
, Dec 20 2010 07:49 PM
3 replies to this topic
#2
Redone
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Posted 20 December 2010 - 08:17 PM
Sorry to hear that.
Thoughts--
It definitely falls into the "At Worst" as they were quoting you low. Some lenders pay more for impounds, so they were trying to pad their low quote by telling you they were Required. (Not required in CA unless you hit 90 % value)
You say you didn't know the lock expired ? The New 2010 Good Faith Estimate shows the lock expiration on Page 1. Does yours ? At least one should if they were floating then locked later. They could've offered you to extend the original lock to close your loan for a fee. Probably not what you would've wanted but given the large jump it's better than expiration.
If you have equity many refinances don't even require an appraisal...
Insurance -- typically need 60 days coverage from the close date.
As far as a complaint you need to find out if they are licensed throught the Dept of Real Estate OR Dept of Corporations as the State of CA uses both. Their license number and NMLS number should be on ALL advertising including busines cards, websites, etc.
You can PM me if you need more in depth details.
Thoughts--
It definitely falls into the "At Worst" as they were quoting you low. Some lenders pay more for impounds, so they were trying to pad their low quote by telling you they were Required. (Not required in CA unless you hit 90 % value)
You say you didn't know the lock expired ? The New 2010 Good Faith Estimate shows the lock expiration on Page 1. Does yours ? At least one should if they were floating then locked later. They could've offered you to extend the original lock to close your loan for a fee. Probably not what you would've wanted but given the large jump it's better than expiration.
If you have equity many refinances don't even require an appraisal...
Insurance -- typically need 60 days coverage from the close date.
As far as a complaint you need to find out if they are licensed throught the Dept of Real Estate OR Dept of Corporations as the State of CA uses both. Their license number and NMLS number should be on ALL advertising including busines cards, websites, etc.
You can PM me if you need more in depth details.
#3
Steve Heard
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Posted 20 December 2010 - 09:59 PM
Wow, sounds like a lot of miscommunication went on there. Complicated issue, and I can't speak to whether or not the guy was competent, but if I can add to Redone's post, here are a few common occurences I've seen:
* Appraisals - Pretty well regulated these days. Almost always paid up front. Almost always booked through an appraisal management company. Almost always booked the the funding lender, not the broker, so the broker has no control over and know idea who will be chosen. Imagine if the appraiser had done the work and then you decided not to go through with the deal. Maybe the other fees were too high. Maybe the appraised value came in too low. Maybe you just changed your mind. The appraiser still did the work.
* Impounds - Some lenders will charge a higher interest rate if you do not have an impound accout for taxes and insurance. It protects the lender from having you fail to pay taxes or insurance.
* Insurance - It is common for lenders to require insurance to be valid for a certain number of months after close of escrow. If your insurance expiring in a couple of months, they may not want to take your word for it that you'll renew and may require you to do so now.
* Rate Lock - Lenders put a time limit on how long they'll keep their promise to give you a certain rate. For example, you can't apply today and get a promise of 4.5%, then come back a year from now and expect them to honor it. Locks can be good for as little as 12 days, but most often are 30 to 45 days. Generally, the shorter the lock, the lower the rate.
It sounds like communication was a problem here. Not knowing the specifics, I can't say that's what happened, but had you been told all of these things up front, you may have been prepared and they would not have caught you by surprise and caused you do doubt your broker.
* Appraisals - Pretty well regulated these days. Almost always paid up front. Almost always booked through an appraisal management company. Almost always booked the the funding lender, not the broker, so the broker has no control over and know idea who will be chosen. Imagine if the appraiser had done the work and then you decided not to go through with the deal. Maybe the other fees were too high. Maybe the appraised value came in too low. Maybe you just changed your mind. The appraiser still did the work.
* Impounds - Some lenders will charge a higher interest rate if you do not have an impound accout for taxes and insurance. It protects the lender from having you fail to pay taxes or insurance.
* Insurance - It is common for lenders to require insurance to be valid for a certain number of months after close of escrow. If your insurance expiring in a couple of months, they may not want to take your word for it that you'll renew and may require you to do so now.
* Rate Lock - Lenders put a time limit on how long they'll keep their promise to give you a certain rate. For example, you can't apply today and get a promise of 4.5%, then come back a year from now and expect them to honor it. Locks can be good for as little as 12 days, but most often are 30 to 45 days. Generally, the shorter the lock, the lower the rate.
It sounds like communication was a problem here. Not knowing the specifics, I can't say that's what happened, but had you been told all of these things up front, you may have been prepared and they would not have caught you by surprise and caused you do doubt your broker.
Steve Heard
Folsom Real Estate Specialist
EXP Realty
BRE#01368503
Owner - MyFolsom.com
916 718 9577
#4
Dave Burrell
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Posted 21 December 2010 - 09:48 AM
So, back in September, I got a great mortgage re-fi deal from a broker in San Jose...initiated paperwork...and then another one (local) came along and offered a slightly better deal (a difference of 0.125 % actually) and I decided to switch.
Crazy back and forth regarding paperwork ensues...like, can you sign again this time without date or sign again with yesterday's date....along the way, he asks me to pay for appraisal which he said would be re-imbursed at the time of close/settlement.
Weeks go by, then he says impound account is part of the deal....I question that...so he says it will cost $400 extra ....I agree to impound account...don't wanna pay extra.
My home insurance is paid up to Feb and I tell him I plan to shop around and change then...he says change it now...which I do...and then - on Friday Nov 19th, he says the title guy is gonna come to my house to sign the paperwork...
And then, on Monday (Nov 22nd) he says the rate lock expired and since the bank did not receive the new insurance company's paperwork thus couldn't come and now we have to wait for the rates to come back down...the guy never warned me even once that the rate lock would expire. He just kept stringing me along for over 2 months with something or the other.
At worst - the broker weaned me away by offerring cutthroat rates, had me pay to the appraiser (may be getting a cut on that) ... then throw in another $400 on pretext of impound account...which means he's a crook.
At best....he is absolutely incompetent and his incompetence prevented me from getting a lowest possible rate....
Is there any way I can take him to dunno-where (court may be)- get him written up, slapped on the wrist...have my appraisal money refunded...and be compensated for the lost opportunity? Could I sue the bank as well for perpetrating such a nasty joke?
That really sucks, sorry to hear you got worked over by this schmuck.
Maybe one recourse is to post his name and business as a warning to others. The only thing I can suggest is contacting the BBB and reporting him, just to have it on record. Other then that you're probably out the dinero you paid..... it's too bad this guy pulled you away from the other deal.... shysters like that need to be kicked around and taught that it's not nice to screw people over.
good luck!
Travel, food and drink blog by Dave - http://davestravels.tv
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