Financing in San Ramon>Question Details

SanRamonKeen…, Home Buyer in San Mateo, CA

Can I trust the lender in this scenario, where paper work is different from what was negotiated via phone/email ?

Asked by SanRamonKeenBuyer, San Mateo, CA Thu Apr 14, 2011

The lender I am working is has promised that the rate they offered will not have any points. But in the paperwork (Good Faith Estimate) they send me. They are charging close to 1.5 points. The Agent is telling me not to be worried and it will be waived and i have to trust them. Is it wise to sign the Loan papers with GFE not reflecting the waivers I was promised via e-mail ?

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Dear San Ramon Keen Buyer:

When purchasing a home you should be comfortable with all aspects of the transaction. And make sure you are comfortable with the information you are given. If you are not sure, you should seek other professional advice. Most real estate agents can recommend several lenders they work with who may be able to give you other options. Hopefully you are discovering this discrepancy before you are at the end of your transaction! Even if you are at the end, and feeling pressure to sign the papers, it's worth taking the time to get another opinion. And get the next opinion in writing.

Good luck with your home purchase. And welcome to the East Bay.
2 votes Thank Flag Link Fri Apr 15, 2011
Hi San Ramon homebuyer,
I respectfully disagree with the agent.
The good faith estimate is supposed to reflect what you were told would happen.
ABSOLUTELY do not trust them to voluntarily make less money than they have declared they intend to make.
Time to go to another loan officer for a second opinion.
2 votes Thank Flag Link Fri Apr 15, 2011
You should run way fast.
Reason 1: GFEs are not signed. If it is a true GFE you are receiving, there is no place for a signature on it and it's not supposed to be signed. If there is a place to sign, it's not a GFE.
Reason 2: The GFE is what it is. If hey are not showing you a credit, it means they don't have to give you one. This is a deceitful method that some use to hedge. They may or may not show the credit at closing, but they certainly are not legally obligated to do so based on the GFE you received.

Get a new quote and an honest GFE.
Web Reference: http://WeFixRates.Com
2 votes Thank Flag Link Fri Apr 15, 2011
Wow! I really apologize on behalf of all the honest loan officers out there. This is a typical ploy used by unscrupulous lenders (normally internet companies). Since we cannot legally give a prospective buyer a GFE until they are under a R.E Contract or have an address for Refinance, this is what we get with the new RESPA changes and the Financial Reform Act. This is a perfect example of how not to conduct business. Since this lender was an idiot and made a "Promise" he obviously was unable to keep or deliver, you have the option of walking away or squeezing his neck. Remember you as a consumer have the power. I would order your LO to stop working on the file immediately and not incur anymore fees. If the appraisal is an FHA, it can be transfer to another lender fairly painlessly. I would then in turn get another lender to give you an honest Good Faith Estimate, based on a copy of your credit report, and you income and asset information. We do not need a credit card authorization in order to issue an honest GFE, it sounds like your LO is a plain dirt bag. Sorry, but I though we had weeded most of these kinda people of our business, but I guess not!
Web Reference: http://www.AFN-loans,com
1 vote Thank Flag Link Tue Apr 19, 2011
First and foremost, signing anything before the actual signing (with a notary) is meaningless and doesn't obligate you to anything. you can still cancel the transaction at any time up to the final signing for a purchase or after 3 business for a refi with the right of resission. That being said, It seems to me like the agent might not have yet locked your loan but rather is floating it to try and get as high of a rebate (up to the 1.5% he disclosed) . If the bond market works in his favor, he'll be able to deliver to you the rate he promised you with 0 points and he'll get the 1.5% rebate for his efforts and everyone is happy. If the bond market goes on a major move against him/you then he'll give you the bad news and he can charge the 1.5%.
1 vote Thank Flag Link Fri Apr 15, 2011
Hello Home Buyer-

I would not sign anything that was not correct- I think it might be wise to get another opinion........... maybe talk to
1 or 2 other lenders.
1 vote Thank Flag Link Fri Apr 15, 2011
Get a second opinion. I always tell people to speak to at least 3 different lenders to get the best deal
1 vote Thank Flag Link Fri Apr 15, 2011
I wouldn't trust him...he told you no points, then shows points, then tells you not to worry until the end to see it's waived. What if it's not waived? You just wasted your time and processor's time and if you are buying, then you're pressured to close.

Get a second opinion, shop the points. Originators that say one thing and do another aren't too ethical IMO.
1 vote Thank Flag Link Thu Apr 14, 2011
If the points were not part of the original GFE, I would recommend a second opinion from a local lender, there are enough ethical lenders out there to have confidence that they are looking out for your interests and their fees and charges are in-line with the market
1 vote Thank Flag Link Thu Apr 14, 2011
That is strange. Is it being offset by any credits on the GFE?
1 vote Thank Flag Link Thu Apr 14, 2011
Never sign anything that does not reflect what you are told!!!!!!!!!!!!!!!! This is certainly a RED flag if I ever saw one. The GFE should reflect what your closing cost should be and show all bank charges. If they differ from what you are told, back away and seek another venue for your loan. I would shop anyway, you will find someone who is honest.
0 votes Thank Flag Link Thu Jul 21, 2011
Good advice, get more than 1 quote and make sure to get it in writing. Compare apples to apples, like most things concerning real estate verbal means, nothing and it is what is in writing that counts. In this market, work the lenders against each other for the best deal.
Best of luck.
0 votes Thank Flag Link Thu Jul 21, 2011
My best advice is to seek out multiple lenders to get a feel for which one will give you the best rates. Just like any other business a friend that refers their lender to you is where I would start. I always advise my clients to seek out multiple lenders and find the one they feel best suits their needs.
0 votes Thank Flag Link Thu Jul 21, 2011
Well I need to close this question with update on what happened to my case. The lender did not have any bad intentions ( at least to me). Having additional points enables me to do rate renegotiation. Since banks will consider such a request if the rates more than 0.5 percent.
0 votes Thank Flag Link Tue Jul 19, 2011
San Ramon,

I would also be looking at this sideways. The NEW GFE's are supposed to be ACCURATE and there are harsh penalties for errors in the banks favor. IT sounds as if the lender is being sloppy and providing "cover my buns" cost estimates to you. If your lender is a big bank, NO you should NOT trust them (big banks are notorious for raiding buyer cash reserves in order to protect their own interests. I guarantee that if its on the GFE they will charge you those proceeds. I speak from experience. If your lender is a broker, you may wish to get as second opinion.
Web Reference:
0 votes Thank Flag Link Tue Apr 19, 2011
The lender shouldn't have to 'promise' you things that should be clearly printed on the GFE.

As mentioned several times, get a second opinion from another loan broker. A number of us local real estate agents would be happy to recommend a reputable local lender. Just ask!
0 votes Thank Flag Link Fri Apr 15, 2011
Difficult to render an opinion UNLESS all documents are reviewed. Request the loan officer place that in writing to you if you have any concerns

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
0 votes Thank Flag Link Fri Apr 15, 2011
Marc: I never got a original GFE. This is the first GFE I was asked to sign. I was forced to give my credit card info for appraisal charge to lock in what seemed a great rate.
Nicolas: No Credits shows on GFE. My total closing charges twice as I was promised.
0 votes Thank Flag Link Thu Apr 14, 2011
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