Lender's app at closing doesn't match broker's app

[nissandave]

What is the name of your state?nc

Okay, I have a really bad feeling about this and need some good insight. I have trusted our broker.
We had a foreclosure completed in 12/03. The mortgage WAS DISCHARGED in our ch7 in 12/02. When we started mortgage shopping, 2 of the 3 brokers that presented us a deal said that if we checked "No" to the question referencing any past foreclosures in the previous 7 years on our application, then they could do the deal. We animately refused to each of these brokers to lie on our application. The third broker said "No problem" either way. Well, when we filled out our mortgage app with the broker, we made sure the answer "Yes" was checked for that question. After speaking with the broker about the info I got here as to how we could get Flex 100 approval with a Fannie Mae loan with a foreclosure (which isn't listed on our credit reports), she explained that since the mortgage was discharged in our ch7 case that the date being used for the foreclosure date was the date of ch7 discharge. One of our credit reports was listing the mortgage as R9 Chargeoff, with no balance. Well, I again asked the broker about us being listed in the CAVIR system and she said that she had gotten us approved with Desktop Underwriter software used for Fannie Mae loans. She said that despite the foreclosure, we were approved. She even stated that she had called a Flagstar representative and "hypothetically" gave the rep our situation and the rep replied that so long as there is proof that the deficiency balance of the foreclosure sale could not be collected upon then they could do the loan.
Well, at closing, we given our booklet of paperwork to sign and many of the sheets of paperwork had been shrunk. They were looked as though they had been copied at 75% of actual size. I am not sure if this was intentional or not. Anyway, the lawyer's employee that was having us to sign all these papers was giving us a "layman's explanation" of what each paper stated. When we got to the mortgage application, she said that this was another copy of the original app we needed to sign and that everything on the app was accurate at the time of original app signing (paraphrased) and that the numbers would not be accurate as our account balances are undoubtedly different. So we signed as we figured we are paying the attorney fees, hence the attorney was working for us.
Well when we got our documents back, I was looking at the application. There were many errors, none substantial, except for the foreclosure question. It was checked "No". I called the lawyer's office and they said that that was one of the forms that was filled out by the lender and/or broker's company and to call the broker. I called the broker and she stated that it was evidently just a typo and that the form came from the lender and she had downloaded it and not to worry. She stated that the original application was the one that mattered and the lender has the original and that loan approval was given off the original.
Do we need to worry and what should we do?
I was considering sending the lender, Fannie Mae, broker's company, and the lawyer's office a certified letter pointing this out. Are we doomed?

 

[nissandave]

Does this letter sound good? I am going to send it CMRRR to Fannie Mae, Broker, Lawyer, and Lender. Any suggestions?
Do I need to get someone to witness this is the actual letter sent to each place? If so, would that be a notary public?


April 18, 2005


Flagstar Bank, FSB
5151 Corporate Drive
Troy, MI 48098
Closed Package Receiving, W-800-1



RE: Mortgage Loan # 000000000



After receiving our copies of the closing paperwork on the above referenced mortgage, we are alarmed to find that there are discrepancies on our Uniform Residential Loan Application. The original Uniform Residential Loan Application we signed with our broker specifically referenced our past foreclosure in Part VIII Declarations, questions c and e. At closing, the Uniform Residential Loan Application was shrunk down in size to make it much more difficult to read. Additionally, our settlement agent led us to believe it was identical to the one which we signed at our broker’s office. I am enclosing a copy of the actual Uniform Residential Loan Application for your review with the corrections marked in. This is the actual size document which we were led to sign at the closing attorney’s office. Please substitute the corrected form for the erred form. My wife and I did not knowingly or intentionally make any misrepresentations on this document. If you will review the original loan application from the broker, dated March 21, 2005 (date?), you will find this application was marked appropriately.
We had a mortgage with Washington Mutual. This mortgage was discharged in our chapter 7 bankruptcy which discharged on 12/12/2002. The foreclosure was completed in 12/2003. I am enclosing a copy of a letter from Washington Mutual stating that they are aware that they cannot attempt to collect on any deficiency amount from this mortgage ever and that they are aware that this debt was discharged in our chapter 7 bankruptcy case. We were truthful to the broker about this situation and explained that other brokers had asked us to lie on our application about this. We animatedly refused to lie and explained this to our broker. Our broker, NAME, stated that as long as there is no judgment showing for the foreclosed mortgage, then we should be able to get a Fannie Mae loan approval. After questioning our broker as to how loan approval is possible with the fact of past foreclosure, she explained that since the mortgage was discharged in our chapter 7 bankruptcy, the actual foreclosure date considered was bankruptcy discharge date, not the actual foreclosure completion date. Our broker went on to explain that as long as there is no possibility of Washington Mutual placing a judgment on us for any deficiency amount, that the lender, Flagstar, and Fannie Mae would give loan approval.
We got our closing paperwork in the mail a few days ago. After reviewing the loan application and discovering the error, I attempted to contact the settlement agent and the broker. A receptionist at the attorney’s office stated that that particular document came from either the lender or the broker. She suggested that I contact the broker about this error. After contacting our broker, she explained that the error was simply a typographical error on Flagstar’s part and that there is nothing to worry about. She further explained that she had not caught the error because the loan application was pre-populated with the information contained in it and she simply downloaded it to forward to settlement agent. I explained that we were still uncomfortable with it. The broker stated that since the original loan application was correct and accurate, and the fact that it was the one which the loan approval was given, then the typographical error is not significant. Of related note, the foreclosure is not listed on our credit reports since it was included in our chapter 7 bankruptcy. We have always refused to hide any information such as this and wish to confirm that Flagstar is aware of this fact. Our broker stated that we were approved with a Fannie Mae approved loan through the application she submitted on our behalf with Desktop Underwriter. While we do not have actual knowledge of the information contained in our electronic application submitted to Fannie Mae and/or Flagstar, we wish to correct any errors which may have taken place.
This letter’s purpose is to demand a correct and accurate Uniform Residential Loan Agreement for the above referenced loan in its original legal letter size, in order to correct the above mentioned errors, as we have just gained knowledge of. Will the responsible party(s) please contact us immediately to arrange for the signing of a correct and accurate Uniform Residential Loan Agreement, as signed at broker’s office in March, 2005. This demand is sought in agreement of the Compliance Agreement which was signed on 4/11/2005. This letter will serve notice that we have made all reasonable attempts to correct this error. Additionally, this letter will serve notice that we had no knowledge of the error(s) contained on our loan application and we wish to immediately cooperate in the adjusting for any clerical errors. Failure to comply with this demand will be taken as all parties being advised of this error deems this error as not being significant, not being necessary to correct, and not being desirable to correct. Again, we wish to emphasize that we have not had any knowledge of any errors on our Uniform Residential Loan Application until the receiving of our copies of the closing documents delivered to us via US Postal Service.
If you have any concerns or questions, please call me at 000-000-0000 or 111-111-1111. For your information, our broker was NAME, from BROKER'S COMPANY phone 222-222-2222 and our settlement agent was NAME, from LAWYER'S OFFICE, phone 333-333-3333.
We are very grateful for the opportunity your company has provided us to purchase a new home and hope this matter will not hinder our home ownership. If you could please send us a letter of confirmation confirming receipt of this letter, it would be most appreciated. Thank you for your time and consideration.