Chizz Posted November 9, 2013 Share Posted November 9, 2013 Ok so here's the story. My wife and I closed on our co-op and new house yesterday. In order to get our house, we had to apply for an FHA loan. 2 weeks ago we were locked in with a rate of 4.25% and then 3 days prior to closing was told we HAD to buy down our rate to 3.875% and that it would cost an additional $4,800 from the $3,650 that was already budgeted in case we did need to buy it down. My question is simple. Does this crap usually happen? The mortgage lender laid out the extra $4,800 and basically told me that I could be a nice person and pay him back or be a douchebag and forget he did that for us and not pay him back. Obviously he didn't say it like that though. I don't understand A. Why a total stranger would lay out $4,800 without getting us to sign paperwork that we'd pay him back. B. Why I was FORCED to buy down my rate in order to close on the FHA loan. The kicker here, is my lawyer had never heard of such a thing and while we were at our first closing yesterday (which my loan officer was not at), we were talking about it and the loan officer of that deal over heard us talking and told us that is absurd. FHA loans right now are at 3.875% with no points and that he should've just redid our rate at that with no extra charges. When we got to the 2nd closing, we explained this to our loan officer and he explained that it simply was not true and that all FHA loans have new requirements that make their borrowers buy down their rates. His father who owns the company, jumped in and started getting offended and got loud with us telling us that they weren't lying blah blah blah. At the end of his tirade, he said we're closing today with 3.875% and you guys are not paying Michael (his son who did our loan from day 1 and did a fantastic job up until that point) the $4,800 that he lent out and he will not be making money on this deal because of it. Basically what I want to know is do I pay him back or not. I have no idea if I'm being duped. I am a person with strong morals and would be devastated if I made the wrong decision. Part of me says that they had no choice to buy down the rate to close the loan and I absolutely would pay him back for that. The other part says that they knew they could re do the rates and have it locked in at 3.875% without buying points and they are pocketing the $4,800 if that were the case. So do I pay him back or not? Is there a way to show proof they paid the $4,800 to buy it down? Link to comment Share on other sites More sharing options...
Mike Posted November 9, 2013 Share Posted November 9, 2013 His father who owns the company, jumped in and started getting offended and got loud with us telling us that they weren't lying blah blah blah. At the end of his tirade, he said we're closing today with 3.875% and you guys are not paying Michael (his son who did our loan from day 1 and did a fantastic job up until that point) the $4,800 that he lent out and he will not be making money on this deal because of it. I have no experience in this other than being a home owner myself. But was this said as in, the father said forget it, you don't have to pay it? So rather than explaining it, he got angry and then said forget it, but Michael won't make any money on the deal? Is that correct? Link to comment Share on other sites More sharing options...
Patrick Bateman Posted November 9, 2013 Share Posted November 9, 2013 Mortgage brokers are some of the worst people around. He was definitely pulling some shit Link to comment Share on other sites More sharing options...
Dave Posted November 10, 2013 Share Posted November 10, 2013 Sounds like he was trying to scam you to me. Any big last minute changes to a deal like this, trust your lawyer. He's your advocate in this and it is his business if he's a real estate lawyer to know about these things. A mortgage brokers job is to make as much money as they can off you. And if one says they are just going to work for free, they are lying. I'd call someone at FHA and let them know what happened. Link to comment Share on other sites More sharing options...
Vodka Drunkenski Posted November 11, 2013 Share Posted November 11, 2013 It's a scam, don't pay. Link to comment Share on other sites More sharing options...
Chizz Posted November 13, 2013 Author Share Posted November 13, 2013 I believe it's a scam as well. I'm trying to find something on google, but can't find a thing saying that FHA requires buying points under any circumstances. This really is killing me. I want to be CERTAIN I am making the right decision. I would never want to make a decision based on opinions. Especially a decision that could possibly leave someone down $4800. All signs point to it being bullshit, but I want concrete evidence so when I tell him to fuck off, I can back up my decision. Link to comment Share on other sites More sharing options...
Mike Posted November 13, 2013 Share Posted November 13, 2013 I believe it's a scam as well. I'm trying to find something on google, but can't find a thing saying that FHA requires buying points under any circumstances. This really is killing me. I want to be CERTAIN I am making the right decision. I would never want to make a decision based on opinions. Especially a decision that could possibly leave someone down $4800. All signs point to it being bullshit, but I want concrete evidence so when I tell him to fuck off, I can back up my decision. Don't tell him to fuck off. Be a gentleman about it. If it ever comes up again, and you do find out that you owe $4800, go pay him, or make arrangements to pay him. Here's the thing ... you want to do the right thing, but handing him 5 dimes and walking away may not be the right thing, and you'll never get it back. You trust yourself to pay him in the future, so lets just say the money is in "escrow", until you get concrete evidence. Link to comment Share on other sites More sharing options...
Pete Posted November 13, 2013 Share Posted November 13, 2013 It's a scam, things like this don't happen at closing. Everything should be buttoned up well in advance. If someone asks for additional monies at closing, it's bullshit. Link to comment Share on other sites More sharing options...
Chizz Posted November 13, 2013 Author Share Posted November 13, 2013 Don't tell him to fuck off. Be a gentleman about it. If it ever comes up again, and you do find out that you owe $4800, go pay him, or make arrangements to pay him. Here's the thing ... you want to do the right thing, but handing him 5 dimes and walking away may not be the right thing, and you'll never get it back. You trust yourself to pay him in the future, so lets just say the money is in "escrow", until you get concrete evidence. Obviously I wouldn't tell him to fuck off lol. I just want to be as educated as possible on the situation before I'm approached again. Link to comment Share on other sites More sharing options...
Mike Posted November 13, 2013 Share Posted November 13, 2013 Obviously I wouldn't tell him to fuck off lol. I just want to be as educated as possible on the situation before I'm approached again. Why not? Depending on the situation, that could be the right thing to do. I just wouldn't do it to someone who's in control of my mortgage, at the moment. A month from now, my behavior may change. Link to comment Share on other sites More sharing options...
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