Very fishy practices happening with refinance lender in WI - HELP!!!

[aparker]

We recently refianced our condo in Wisconsin. Our former lender, Ameriquest, provided the mortgage broker with a payoff statement at the begininning of December. We closed the loan and signed on Dec. 23rd, 2005, and we were due to receive a small amount of cash from the loan, around $300.00.
On Dec. 28th - 5 days AFTER the loan, and after we can legally withdraw from the loan - we are informed that the payoff amount was short. Ameriquest paid the taxes on our home in the meantime, and didn't include that on the original payoff. So they send a new payoff as of Dec. 28th, and reject the funds transferred from the tite company.
The mortgage broker was hashing this out - Ameriquest wouldn't budge, our new lender Wells Fargo had no room to budge, so it was decided that the broker and title company would figure it out and take a cut. What they came up with is that the broker paid the shortage amount, and now wants us to pay them back $1600.00 plus (total shortage was close to $1900.00). They also issued us a check for our cash out - the $300.00 - and put a stop payment on it - after telling me we would not receive a check at all, that the check had been returned to them and they would just keep it for part of the shortage settlement. Then the title company FedEx's me a check again - so we cashed it. The broker is telling me too bad - you are not getting your cash back, and you still owe us $1600 plus. What can I do??? I feel that this is NOT our fault - we had nothing to do with the payoff amounts getting messed up - that was between broker and Ameriquest.
Also - we signed a CONTRACT for a specific amount, with CASH out!!! They are breaking that contract, after we had signed in good faith. If I would have known this was going to happen, we would have refused to sign with these people. Please help, I really need my options!!!
AParker

[Some Random Guy]

I fail to see the problem here. Your old lender paid taxes that were due on the property and you now have to reimburse them. If they had not paid the taxes, then you would have had to directly pay the $1900 to the state.

Did you expect them to pay your taxes and not expect to be repaid?

Granted, it would have been nice for the lender to look for future tax payments when planning the payoff amount, but that doesn't change the fact that taxes were due.

[aparker]

I realize that the taxes needed to be paid, regardless - I did not expect anyone to "pay the taxes and not be repaid". It is not the old lender that I have to reimburse, it is the mortgage broker. I do not like signing contracts for one thing, and having the numbers and terms change on me because they failed to obtain a more recent payoff. The broker had also informed us that once a payoff is requested by a new lender, it is supposed to put the account with the old lender on hold. Whether this is true or not, I have no idea, but that's what we were told.
We signed the papers in good faith, expecting a check. When we received the check and cashed it, it bounced. That is what I have a problem with. If we had known about this beforehand, we would not have signed the loan documents.

[Blacky1]

I would need to see acopy of the HUD1 Settlement Statement. On page 2 ., the breakdown of homeowners insurance and real estate taxes...how many months were impounded? I am guessing that if neither the loan officer or the title company knew that Ameriquest was going to pay your taxes for 2005, they would have collected the necessary amount to ensure you were covered. With that being said, by ameriquest paying your real estate taxes, you should have an amended HUD with updated figures. Also, you will receive a check from Ameriquest approximately 10 business days after closing for all funds in your Ameriquest Escrow account as the new lender is setting a new one up. I would be reluctant to give the broker anything until I saw the amended HUD and compared it to the original.

[Blacky1]

This broker sounds very inexperienced. Tell him to chalk it up as a learning experience. He would have paid this through a broker credit shown on page 1 of the HUD. This would be taken out of the YSP (Yield Spread Premium) or SRP which is paid by the lender. I would not worry about it. Tell him you are going to file a complaint with the Florida Department of Banking and Finance. He will change his tune real quick. Trust me.

[ice5146]

Ameriquest normally sends their Payoff Demand Statements good through the date requested only. If you add the Per Diem from the date the Broker ordered the Payoff until the date the loan Funded, that looks to be around 1900.00 assuming your Per Diem was about 70.00 per day.

Another thing--any Taxes or Homeowner's Insurance Premiums due within 90 days of your first payment date should have been included on the Settlement to be paid at closing. i.e, Property/Municipal Taxes due April 30th for 1900.00 shoud have been included on the Good Faith Estimate if known at the time or told to you from your Broker that they are going to be required to be paid at Settlement. This is assuming you were not currently Escrowed with Ameriquest. If Ameriquest paid your taxes for you, you must have been pretty delinquent or Escrowed. Title Companies provide Tax Certifications to Brokers showing your taxes due and then collect them at Settlement.

So what I'm saying is that it sounds like you were Escrowed, the taxes were paid, and my 1st paragraph applies.

You signed the Settlement Statement and on there you will see exactly what payoff amount they included to Ameriquest. That amount was originally lower giving you 300.00 cash at Closing. If the actual amount owed to Ameriquest is 1900.00 higher, it's going to be because of per diem interest. The Title Company should have caught the "good through" date on the Payoff Demand Statement and padded enough on the Settlement Statement to carry you through Funding plus a few days. This is not only the Broker's fault.

I'd tell the Broker to eat his Fee by 1900.00. I'm sure they charged you a Broker/Origination Fee plus received a broker comp fee from the Lender for charging you a higher rate. Look on your Settlement Statement in the 800 lines and see if there is a fee labeled YSP or Broker Fee to Lender in very small type.

I don't believe in working for free but it sounds like they didn't tell you taxes were going to be due upon Settlement and didn't order an updated Payoff Statement so that's their loss for sloppy processing.

[HomeGuru]

Originally Posted by aparker

I realize that the taxes needed to be paid, regardless - I did not expect anyone to "pay the taxes and not be repaid". It is not the old lender that I have to reimburse, it is the mortgage broker. I do not like signing contracts for one thing, and having the numbers and terms change on me because they failed to obtain a more recent payoff. The broker had also informed us that once a payoff is requested by a new lender, it is supposed to put the account with the old lender on hold. Whether this is true or not, I have no idea, but that's what we were told.
We signed the papers in good faith, expecting a check. When we received the check and cashed it, it bounced. That is what I have a problem with. If we had known about this beforehand, we would not have signed the loan documents.

**A: you are liable and the what they did was legal. I am sure that we have not heard the entire story.