Realtors: 2 Deals In 1 – The Purchase Reverse Mortgage

Back to Back Closings

Back to Back Closings

Realtors: 2 Deals In 1 – The Purchase Reverse Mortgage

The Home Equity Conversion Mortgage for Purchase (HECM) is known in the industry as the H4P. The H4P is an FHA Insured reverse mortgage which is guaranteed by the Department of Housing and Urban Development.

In writing this post I recall a specific H4P transaction where I was privileged to originate a purchase reverse mortgage for a delightful fellow Colorado native. This transaction closed in July 2013. The purchaser, age 63, sold her townhome in Parker for $115,000.00 and in conjunction with the H4P used the combined proceeds to purchase a townhome in Castle Rock for $227,600.00.

The financial details of that transaction are as follows: The buyer’s cash to close requirement was $96,400.00 plus her earnest money of $2,000.00. This sum of $98,600.00 included pro-rata property taxes, insurance and HOA fees.  The H4P proceeds to close were $129,200.00. In addition, the FHA UFMIP, origination fee and allowed closing costs totaling $11,400.00 were financed. All figures have been rounded to the nearest $50.00.

Purchase Price $227,600.00
Buyer Cash to Close + Earnest Money     98,400.00
H4P Cash at Closing $129,200.00
Financed Closing Costs     11,400.00

She found it most desirable to purchase her new home and not have to make mortgage payments ever again. Of course, she may make periodic payments or payoff the loan at any time but only if she wishes. It bears observing that she made this decision with the blessing of her children, one of whom is a CPA. Going forward, she simply pays the taxes, insurance and HOA dues. She does not need to pay monthly mortgage payments again for so long as she lives in her home.

On qualifying, for all intents and purposes, this was a Stated Income loan. As a matter of responsible underwriting, it was merely confirmed she had sufficient income to pay real estate taxes, insurance and HOA dues.

Due to adjustments* which FHA made to the HECM program in September 2013, an identical transaction as described in this post would presently require cash to close from the buyer of approximately $114,950.00.

On qualifying, for all intents and purposes, this was a Stated Income loan. As a matter of responsible underwriting, it was merely confirmed she had sufficient income to pay real estate taxes, insurance and HOA dues.

Due to adjustments* which FHA made to the HECM program in September 2013, an identical transaction as described in this post would presently require cash to close from the buyer of approximately $114,950.00.

For additional facts on the FHA Reverse Mortgage program (HECM), you may wish to click on this link: Reverse Mortgage Facts. Further discussion and illustration on the H4P is available on this link: What Is A Purchase Reverse Mortgage?

TIPS: There are no concessions allowed by sellers, builders or agents; this includes any personal property (such as appliances). In addition, the buyer must pay for the title insurance. There can be no repair set-asides; all repairs, where major property deficiencies threaten the health and safety of the homeowner and/or jeopardize the soundness and security of the property, must be completed by the seller prior to closing. Another unique feature of this program is to set your closings for about 10:00 AM and not later than 11:00 AM to help make sure the H4P funds the same day as the closing. On the closer, few are experienced with the H4P, most are experienced with the traditional reverse mortgage and think the H4P is the same. It is not. Given the buyer is paying for the title insurance, I suggest we use a closer well-trained in the HP. I have such a closer.

Finally, although a rare circumstance, should a buyer have two FHA Case Numbers open, the non-purchase case number must be cancelled prior to final loan approval. As of this post, FHA will not allow an application to be taken until the Certificate of Occupancy has been issued.

If a non-borrowing spouse is involved in the transaction, the non-borrowing spouse (NBS) may not be a party to the real estate purchase contract. For more information on the NBS you may wish to read: Reverse Mortgages and the Under-Age 62 Spouse.

[*HUD Mortgagee Letter 2013-27]

Update: There are market and borrower favorable changes pending application to the H4P on September 19, 2017. When they go into effect, this posting will be updated to reflect the changes.

Notice: The information provided is not intended to be an indication of loan approval or a commitment to lend. Additional program guidelines may apply. Information is subject to change without notice.

Disclaimer: This article does not represent that any of the information provided is approved by HUD or FHA or any US Government Agency.

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 Financially Speaking  James Spray, RMLOCNE, FICO Pro |CO LMO 100008715 / NMLS 257365 |Published: April 3, 2014 ~ Updated: February 6, 2017

 Notice: The information on this blog is opinion and information. While I have made every effort to compose and link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

Residential Appraisal Costs and Regulations

Illustration depicting a roadsign with ahow much concept. Abstract background.

Sticker shock is not uncommon for those who have not purchased or refinanced a home loan in the last 4-5 years. This post is to update the reader on the current market.

As background, the cost of an appraisal in the Denver-Metro area historically ranged from $300-$350. Typically, the appraisal was performed by a sole-practitioner, state licensed appraiser. That business model has all but disappeared for residential appraisals for lending purposes.

Given the myriad of new regulations throughout the mortgage industry, $450 $475 is now the going price for an appraisal in the Denver-Metro market.

A combination of market conditions, along with a shortage of approved appraisers, coupled with how soon one needs an appraisal, translates to a rush appraisal. A rush appraisal is defined as an appraisal report completed in less than three weeks. The cost of a rush appraisal may jump to $650.

If one lives in the mountains, let’s say Evergreen or Black Hawk, and needs a rush appraisal, expect to pay even more.

As a matter of practice, in this market, the Appraisal Management Company (AMC) gets a sizeable portion of the fee you must pay for an appraisal. In fact, the appraiser may now be paid less per appraisal than prior to the regulatory reforms. In fairness, the appraiser now gets paid for every transaction, which was not always the case prior to the enactment of Dodd-Frank and the boom of the AMCs.

The market has fewer sole-practitioner appraisers as most now work for an AMC. The AMC model has been around for decades, but due to the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010, commonly referenced as the Dodd-Frank Act, the AMC is more the norm than the exception.

There are those, whose sentiment is expressed by Sam Heskel from a recent post in the Origination News, who believe consumers would be well served by seeing a breakdown of the fees, for the appraiser and the AMC, as separate line items on the closing document.

Regarding the sticker shock, this is an entirely new mortgage lending environment. You may notice many changes, some of them very good, as you go through the process of obtaining your new mortgage.

For suggestions on what to do to prepare for an appraisal, see: Preparing for The Appraisal – Selling or Refinancing.

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Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | September 27, 2015 | Update 8/28/16

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

The NEW Reverse Mortgage

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It is my pleasure to specialize in the origination of Home Equity Conversion Mortgages (HECM) for the benefit of our clients. These are best known as Reverse Mortgages. The type of Reverse Mortgage we offer, and the most utilized product available in Colorado, is the one insured by the Federal Housing Administration (FHA) of the US Department of Housing and Urban Development (HUD) as further discussed by the Federal Deposit Insurance Corporation (FDIC) and as discussed by the Consumer Financial Protection Bureau (CFPB).

  • The minimum age for a borrower is 62.
  • A non-borrowing spouse under age 62 gets to be on the deed.
  • Reverse mortgages are extremely well protected. Guaranteed by HUD; Insured by FHA.
  • One of the protections is the requirement that borrowers receive counseling from a third-party HUD Certified Housing Counselor – often at no cost to the prospective borrower.
  • No monthly out-of-pocket mortgage payments required.
  • The reverse mortgage is due once the home is no longer the primary residence of the borrower(s) or the non-borrowing spouse.
  • Out of pocket expenses are limited to property taxes, insurance and HOA fees (when applicable).
  • The property is to be kept in good condition.
  • The interest rate is not determined by income or credit score.
  • The interest rate is based on the program chosen (FRM, Monthly/Annual ARM, and Low-cost Annual).
    • Flexibility on how funds are received (traditional):
    • In an interest bearing line of credit and/or;
    • As monthly payments and/or;
    • In a lump sum payment and/or;
    • In any combination of the above methods.
  • There are no restrictions on how the funds may be used.
  • The title remains in the borrower’s name. The bank does not own your home. You may sell at any time.
  • There is no equity sharing. Your equity is your equity.
  • Credit review – The credit review is minimal providing there have been no serious derogatory credit issues, such as bankruptcy or unpaid credit obligations, in the past two years.
  • There is no minimum credit score requirement.
  • Financial Assessment (FA) – The financial underwriting is minimal. The lender must be assured the borrower has the income and will to pay real estate taxes and property insurance.
  • Under FA, a full or partial set aside account may be required to pay taxes and insurance.
  • Closing costs are comparable to other FHA insured home loans.
  • There are no mark-up or “junk” fees allowed.
  • One may still receive Social Security and Medicare benifits with a reverse mortgage.
  • The reverse mortgage is a loan so the proceeds are not treated as income.
  • There is no prepayment penalty; the borrower may pay-off the reverse mortgage at any time with no penalty.
    • Reverse mortgages are non-recoursable; if more is owed than the value of the property, the lender may not collect the deficient amount from either the borrower or the estate.
    • Heirs may sell the property and pay off the mortgage. In the event more is owed on the property than the value of the property, the heirs may purchase the property for 95% of the market value as opposed to paying the full amount of the mortgage.
  • Reverses Mortgages are also used for Purchase Money. Click here to learn more.
  • Security is provided for the under age 62 spouse. Click here for more information.

DISCLAIMER: This publication does not represent that any of the information provided is approved by HUD or FHA or any US Government Agency.

DISCLOSURE: The information provided herein is not intended to be an indication of loan approval or a commitment to lend. Additional program guidelines may apply. Information is subject to change without notice.

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Financially Speaking™ James Spray RMLO, CNE, FICO Pro | CO LMO 100008715 | NMLS 257365 | November 2, 2016

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct for your situation. This information is not legal advice and is for guidance only. You may reproduce this information in whole and not in part, providing you give full attribution to James Spray.

Purchase or Refinance During a Chapter 13 Bankruptcy

Chapter 13 Plan

Chapter 13 Plan

This post is written both for those contemplating a Chapter 13 (repayment plan) bankruptcy as well as for those currently in a Chapter 13 Plan. A Mortgage refinance or a home purchase, while still in a Chapter 13 bankruptcy, is possible; it is also a complicated financial and, legal transaction. To do this requires a highly specialized mortgage professional experienced with both FHA lending rules and Chapter 13 bankruptcy as well as local court rules.  Such an individual must know how the Chapter 13 Trustee in your Federal Bankruptcy District deals with this process. It is helpful if your attorney respects the reputation of your mortgage professional.

The Chapter 13 Payment

One of the most important things to understand is how important on-time Chapter 13 Payments are to the mortgage underwriting process. I strongly encourage you to read this: The Chapter 13 Payment. Your Chapter 13 Trustee payment is given the exact consideration as your mortgage payment by the rules of mortgage underwriting. From the underwriting perspective, one thirty-day late payment of either the mortgage or Chapter 13 Trustee payment will sink your prospects of getting mortgage loan approval. Mail your payment early or set your on-line bill pay or direct payment to the Trustee so that you always know your payment has had time to get to the Trustee’s office and be posted by the staff at that office. Too many times, on review of the Chapter 13 Payment history, we find a payment was posted on the 2nd day of the month. One day counts as a late payment. Your experienced mortgage lender can help you check your Chapter 13 payment history in real time.

Mortgage Choices for Chapter 13 Debtors (purchase or refinance)

The only mortgages available, either for refinance or purchase, for those in a Chapter 13 Plan are those which are insured or guaranteed by the Federal government. These mortgages are either: insured by FHA or guaranteed by VA or, the USDA.

Providing you qualify you may get a Government Insured Mortgage: FHA, VA or Rural (USDA) while in Chapter 13 Bankruptcy.

While there are distinct differences within these three programs, they are alike in their Chapter 13 Bankruptcy underwriting guidelines*.  A significant factor is that the only choice is a 30-year fixed rate mortgage priced at the current market rate. To be clear, there are no conventional mortgages available for potential borrowers. One should understand sub-prime mortgages have not been available in the US since 2008. For additional information regarding adverse credit events timelines and mortgage timeout rules click here.

There are now non-Qualified Residential Mortgages (QRM) which may allow a borrower to purchase or refinance once the Chapter 13 case has been Closed following the Discharge. The rate in this type of loan is higher than any other mortgage product available. The costs are also higher.

How does a bankruptcy affect a borrower’s eligibility for an FHA mortgage? A Chapter 13 bankruptcy does not disqualify a borrower from obtaining an FHA mortgage provided the lender documents that one year of the payout period under the bankruptcy has elapsed and the borrower’s payment performance has been satisfactory (i.e., all required payments made on time). In addition, the borrower must receive permission from the court to enter into the mortgage transaction. The exception is that most underwriters will consider the Chapter 13 Trustee’s approval as acceptable permission from the court.

What are some of the factors that will keep you from getting approved?

If there are still balances showing as unpaid on your credit report, even if the debts are listed in your bankruptcy, the debt will need to be paid OR the underwriter will need proof that the base of your Plan will be paid off with the refinance. If there are balances showing and you are unable to pay-off the base of your Plan, you may be unable to refinance until after you receive your Discharge and the case has been closed.

If a second mortgage is being stripped or crammed down in your Plan, the Chapter 13 must be Discharged and the deed removed from the property or the mortgage servicer must agree to a subordination. If there are judgment liens against the property which are being stripped from the property, your bankruptcy must be Discharged. Depending on how the Plan is written this can be simultaneous if the Title Insurance company legal department understands Chapter 13 with a Strip on Discharge.

The Application to Incur New Debt

To get underwriting approval for a Chapter 13 Debtor to refinance, the Chapter 13 Trustee (Colorado) or Court must approve your application to incur new debt. Talk with your attorney to determine how and when to best proceed, or not. This is a process which you can only do with the assistance of your attorney. Your attorney must prepare the financial statements to submit to the Trustee in order for authority to be granted for a lender to offer new credit. Your mortgage loan originator should be able to assist your attorney in completing the Application to Incur New Debt. If your mortgage loan originator does not know how to prepare such, you should find someone with more experience to help minimize your legal costs.

This is a Great Time to Refinance

Now is, without a doubt, continues to the best time in over sixty years to purchase a home or, refinance a home loan. As this is written fixed rate 30 year FHA mortgages are still at historic lows.  For those with an Adjustable Rate, Option ARM or a Balloon Mortgage this is an excellent time to refinance. This process typically will take planning and action prior to refinancing. This is not a run of the mill refinance and not every mortgage lender is qualified to do this complex transaction.

Mortgage Refinance After Chapter 13 Discharge?

Yes, one may refinance after the bankruptcy case has been Discharged the Court and then Closed by the Trustee. However, because of the new rules for virtually all mortgage financing in the USA, once the Chapter 13 Plan has been successfully completed and Discharged, getting a mortgage refinance can be difficult. This is because a manual underwrite is mandated* and few lenders are willing to take the risk of not having the safe harbor provided by the Qualified Residential Mortgage rules. Begin reestablishing good credit while your case is still open so by the time your Discharge enters, you have solidly reestablished good credit. There are numerous posts in my blog on rebuilding credit, even while in Chapter 13.

Preliminary Requirements for Purchase or Refinance While in Chapter 13

  • Twenty-four months of current housing payments with no 30-day late payments and, the likelihood of the income continuing for at least three years.
  •  Two years IRS Returns showing your income is sufficient to pay the mortgage as well as your Chapter 13 payment and any debt not included in the bankruptcy payment.
  • Minimum middle FICO Score of 680 . Most will need to practice what I’ve previously posted as FICO  101a, 101b and 101c for several months prior to making a successful application for mortgage credit.
  • For anyone with a fear of having credit make time to read both Credit: Use It to Build It (Part 1) and Credit: Use It to Build It (Part 2).
  • Begin rebuilding your credit as soon as your Chapter 13 Plan is Confirmed/Court Approved; this is when your property has been revested to you.
  • The maximum no-cash out loan to value on an FHA appraisal is presently 95% – Refinance.
  • The minimum down payment is 3.5% of the purchase contract or appraised value whichever is less. – Purchase
  • The maximum Debt to Income Ratio is 42.99% and this is pushing the envelope to the extreme.While in Chapter 13, it is mandatory to have Court approval (in Colorado, generally the Trustee approval suffices) to obtain a mortgage, go to this URL FHA Handbook 4000.1 II.A. 5.a.iii (H)(2)(3).
  • There is more detail to this process but this is the essence of purchasing or refinancing while in Chapter 13.

There is more detail to this process than can reasonably be discussed herein but this is the essence of purchasing or refinancing while in Chapter 13.

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Financially Speaking™ James Spray, RMLO, CNEFICO Pro
CO LMO 100008715 | NMLS 257365 | November 1, 2010 – Revised May 20, 2017
 
Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

Preparing for The Appraisal – Selling or Refinancing

Make a good first impression, it helps.

Make a good first impression, it helps.

 

 

 

 

 

This post is written primarily for the benefit of the seller and the listing agent as well as the refinance applicant.

  • For most homeowners, the real estate appraisal is a key component to selling a home. It allows the business transaction to occur between the seller and buyer, as well as the Realtor or real estate agent and the mortgage lender.
  • A state licensed appraiser is responsible for preparing the appraisal for a mortgage loan. The appraiser works for or is contracted by an Appraisal Management Company (AMC) which must also be state licensed.
  • To facilitate the appraisal process, it’s beneficial to have the following documents, as applicable and if available, ready for the appraiser:
    • Prepare a list major home improvements (for example, the addition of central air conditioning or updated kitchen) and upgrades including the date and cost of installation as well as permit confirmation where permitting is required by the local government.
    • List any recent property maintenance items such as roof repair/replacement, a new hot water heater, new paint, carpeting, etc. As well as obtain and provide permit documentation when and where a permit is required.
    • Have a copy of a survey or Improvement Location Certificate of the house and land. Again if applicable and readily available. Such may only be required on rural properties.
    • Provide any written property agreements, such as a maintenance agreement for a shared driveway or a common wall agreement(s), etc.
    • List personal property which is to be sold with the home.
    • Provide a copy of the Purchase Agreement on a pending sale.
    • Your Realtor should offer to provide a Comparable Market Analysis (CMA) so you may provide the appraiser with comparable properties and values. Most appraisers value this help. Offer the CMA, do not try to force it on the appraiser.
    • There is nothing in law prohibiting you or your Realtor from presenting a CMA for the appraiser.
  • Once the appraiser arrives at the property, there is no need to accompany s/he on the entire site inspection; it is appropriate to be available to answer questions. Feel free to point out any home improvements and provide the supporting documentation of the cost.
  • On pets, not everyone loves our furry family members as we do.
    • Four-legged friends should be unobtrusive and well-mannered. Dog bites are to be avoided.
    • Feline friends should have recently cleaned litter boxes as well as neatened dining areas.
    • Spray the carpets, bed coverings and cloth furniture with Fabreze an hour before the appraiser arrives.

Other Considerations

  • Accessibility: Make sure that all areas of the home are accessible. Especially make sure access to the attic and crawl space are readily entered. With a locked room, you’ll wish to be certain to provide access for the appraiser so as not to create doubt. Doubt is not helpful for an appraisal.
  • Housekeeping: Appraisers see scores of homes a year and will look past most clutter, but they’re human beings too! A good impression can translate into a higher home value. Make up the beds; clean up the kitchen, etc. We found this article to be most helpful in preparing for showings as well as the appraisal. 24 THINGS YOU CAN DO IN 10 MINUTES OR LESS TO MAKE YOUR HOUSE MORE SALEABLE
  • Pre-Appraisal/PreListing Infographic
  • FHA Financing Eligibility: In the event you wish to have your property eligible for FHA financing, you may wish to: Install smoke detectors on all levels (especially near bedrooms); install handrails on all stairways; remove peeling paint and repaint the affected area.
  • Maintenance: Repair minor things like leaky faucets, missing door handles and trim.
  • Regulations: Some states, Colorado among them, require that carbon monoxide detectors are installed as a matter of law.
  • Sensitivity: Remove sensitive pictures or religious symbols that could prevent an appraiser from taking the required photographs for the report due to privacy concerns.

“Having your house clean does make a difference, even though in theory it should not,” says Mark Ferguson, a real estate professional and property investor in Greeley, Colo. “Appraisers are people, and they are swayed by smells and how a house feels, even if they aren’t conscious of it.” For the complete article, read Do Ultra-Clean Homes Appraise Higher?

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Financially Speaking™  James SprayMLO, CNE, FICO Pro
CO LMO 100008715 | NMLS 257365 | October 11, 2014

Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.

Internet Mortgages: Are Ya’ Feelin’ Lucky?

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This is a true story involving one of my clients. This is not about one of my mortgage customers. This is a client who hired me as an expert witness. He brought me aboard to help clear up a mess created when he sought and was approved for a mortgage refinance via an out-of-state lender he found on the Internet.

We’ll call my client Jed (not his real name). He determined that it was time to refinance and take advantage of the lowest mortgage interest rates in history. He searched the Internet, found a lender and applied for a plain vanilla, no-cash out, rate-term refinance. In other words, he simply wanted to shorten his loan from 30 to 15 years and get a lower interest rate.

Everything on the Internet is true… Right?

Jed found an out-of-state Internet lender who, for discussion purposes, we’ll call KwikNEZeeLoans.k0d (KNEZL)*. Jed researched KNEZL as best he could prior to submitting his refinance loan application. Not surprisingly, the information Jed was able to gather on the Internet about KNEZL was positive. Indeed, they have a high powered CEO who, prior to founding this company, had an impressive track record with one of the original Internet mortgage lenders. As we all know, everything on the Internet is true.

The initial interest rate offered was great! Almost unbelievably great, as the rate offered was 2.5% while most others were quoting rates in the range of 2.75/2.875% for Colorado at the time of his loan application.

Rate increase was not surprising.

Sufficient groundwork has been established, so let’s jump to one of the endings – indeed, the most obvious ending. You are quite right, perceptive reader; Jed did not get the initially promised deal. He ended up with an interest rate of 2.75%. Although a great rate, it’s not the rate initially offered. However this was not the most disturbing problem and the rate bump wasn’t really a huge surprise.

Was this attempted theft by conversion?

Let us now get to the real thrust of this story, and why Jed hired me in the first place. Jed paid his original lender the August payment. Jed’s loan with the Internet lender closed in August. The payment to Jed’s original lender was shown on the HUD1 Settlement Statement at closing as a credit to reduce the principal balance. In fact, it was not credited to the principal so he paid, in essence, an unearned bonus to the Internet lender in the amount of his entire monthly mortgage payment – principal, interest, taxes and insurance in the amount of about $2,500.00. Note that this amount was disclosed, just not credited in fact for Jeb’s benefit. Had this error not been corrected, it is conceivable this could be considered theft by deception and may have required a lawsuit to resolve. On such a lawsuit, it is possible the damages could have been trebled as well as having all legal fees paid. In such a situation as this, where an expert is required, it is typical for the expert fees to be paid along with all other legal fees including attorney fees and court costs.

Or just an honest mistake?

On the surface, one could have observed this Internet lender casually pocketed Jed’s August payment and only properly credited it for him when two events occurred. First, I had been retained to investigate the transaction. And second, upon my strong suggestion, Jeb filed a complaint with the Consumer Financial Protection Bureau (“Bureau”). The Bureau is perceived as being the nine hundred pound gorilla charged with protecting consumers of virtually all financial services conducted in the United States.
I am truly hopeful this oversight was not done as a normal course of business by this Internet lender. If this was deliberate, such activity is outrageous as very few customers would ever notice such deceptive accounting as the correct amount was printed on the Settlement Statement. As such, all appeared to be straightforward and honest.

The rest of the story.

Jeb’s loan closed in August 2012. He was concerned that the August payment he made to his former lender prior to the closing was not reflected on his final statement from the previous lender. The funds appeared to have vanished. He began writing letters to his new lender and his former lender attempting to get an accounting of his missing money. He received no responses from anyone. His phone calls were likewise ignored. Out of exasperation he called me in late October and explained the situation. I suggested that rather than engage me, just yet, he should go around all the middle people and write directly to the CEO of his new lender to see if he could get satisfaction. By the time he hired me in early December, he still could not get a response from his new lender. After four months he was fed up with getting the complete brush off. He was quite ready for me to document the problem(s) in order to file a lawsuit and force the issue into open court. For what it’s worth, KNEZL reimbursed Jed for my fees.

Jed is very detail oriented and a sophisticated borrower. 

He knew something was wrong, just not what it was. Rightly, he sought the help of an expert to help find exactly what was wrong. Frankly, though, no one should have to hire an expert to audit the closing trail to assure that the promised refinance was delivered as promised.

* KwikNEZeeLoans.kod (KNEZL) is a fictional name created entirely from my imagination.
 
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Financially Speaking™ James Spray, MLO, CNE, FICO Pro 
CO LMO 100008715 | NMLS 257365 | January 11, 2013
 
Notice: The information on this blog is opinion and information. While I have made every effort to link accurate and complete information, I cannot guarantee it is correct. Please seek legal assistance to make certain your legal interpretation and decisions are correct. This information is not legal advice and is for guidance only. You may use this information in whole and not in part providing you give full attribution to James Spray.