Bait and Switch? - Rate Hike at Signing

[asylum23]

What is the name of your state? NV

Hello, we went to a mortgage broker to finance our condo. She chose to do 2 loans saying it would save us $ in the long run. At the initial meeting we were quoted $110,000 at 6% and $45,000 at 6.75%. She said they were fixed rates. There was no talk of locking in rates or how long these rates were good for or that they would expire.

About 6 weeks later received paperwork in mail that had interest at 6% and 10%, so I called. They stated my rates had not gone up and that this was an error. 2 weeks later went to title co. to sign paperwork..... the rates were now 6% and 7.75%, and now were adjustable, not fixed as first quoted. I should also mention we were in constant contact w/ this morgage co., they had every oppt'y to say our rates had gone up or told us something. When I called the next day they stated rates had gone up since the seller took so long to have the unit ready. Had no excuse for the rates now being adjustable rather than fixed. Is this normal and legal? If we had known b4 closing the new rates we would have shopped around and not used them. Thank you for any input.

[wanabath]

contact your state banking dept. 1-702-687-4259

[kingston]

As mentioned earlier by wanabath contact your state banking dept. I also assume the rescind period has expired otherwise you can back out of the deal. For future reference review the hud 1 settlement charges to see disbursement of funds, your truth in lending and your good faith to see if anything is not what you agreed upon.

Good Luck to You

[asylum23]

Hello, would contacting them be to make a complaint? It seems reading around on the internet this is a common practice, so I guess it's not illegal. If we had all the info. we could have made a better choice.

I should also add they gave us a supposed good faith estimate on that first meeting. It was $4200. Well right before closing they called w/ all these fees they "forgot" and got added on such as property taxes (how do you forget those?), HOA, and lots and lots of junk fees. Our closing costs ended up being $6700. This is quite a bit more than the g.f.e., though I know that's not legally binding, they did wait til the last possible minute to add these on.

[MortgageGuru]

Look closely at which fees are which. Section 800 contains all of the lender's fees. Everything else is third party or escrows. The loan officer should have estimated at least something for taxes and insurance but those final numbers come from the title company when they receive the package from the lender, usually a day or two prior to closing.

[asylum23]

Hello, yes it was a day or 2 from closing for those new fees. But they estimated no taxes at all, no HOA, no insurance. That did not equal the amount they raised the closing, but the junk fees sure did. Faxing, mailing, administrative, etc. fees for both the mortgage co. and title. It's just that the g.f.e. was so far from the actual closing costs. After I paid and we closed they even had made an accounting error in my favor and I ended up owing $450 more.