Home Refinance Nightmare

Well, probably not that bad but it has been a real headache for me and I have spent a lot of time on this.

I was told no appraisal needed by the loan officer (dealing with 2 people here) which was true, under the terms for a Fannie may loan it is not. BUT they found that the township was entered for the town on the original loan papers so they requested an appraisal at my cost of $450. When I explained the reason I was told I could try calling customer service which I did and they said the correction was easy so they got me in contact with the right person and they generated paperwork (I had to fax them our tax records) for the correction which needed to be signed and notarized which we did last Friday. Today we got a letter in the mail form the loan office (keep in mind this is the same bank) with the address correction to the existing loan. So if they were to check now the address would match the application address which is correct. Keep in mind also this process took over a month from start to finish.

The problem? All along my loan processor (the second guy) keeps insisting I need an appraisal regardless because I cannot go back in time to change the address even if I get it corrected. He said that is the process and that is that. He said get an appraisal by Friday or the application will be canceled. Keep in mind also we have until Dec 1 to close the loan. All other requirements have been satisfied, only the address (appraisal to him) is outstanding.

Why is this guy being such a jerk? Why can't they re-verify the address now and see it was officially changed by them, the same bank? Why is everyone else including the loan officer saying this should work but this guy (loan processor) keeps saying no. The address is corrected now. I even asked the appraiser how he would verify the address and he said he would do it the exact same way (tax documents) as they said they would.

Is this just a excuse to get an appraisal done?

I am so pisssed now, what can I do? The loan officer (the nice guy) even said he can extend the closing date if needed, it is done all the time. He is even seeing if the bank will pay the appraisal fee if it has to be done (% rate adjustment).

I feel this other guy is taking the easy road and being a bully because he has the power to deny the refinance.

Sorry about your headache. Hope it resolves quickly.

He's covering his butt. And if you get the appraisal, don't be surprised if it feels like a prostate exam and then comes in low. They're all covering their butts now since they all got beat up after housing market crash. At this point I would weigh my options. The appraisal is $450. Although, you don't necessarily have to use their appraiser. You could shop around. I don't know how much you're into this already in terms of any up front costs, but you could just find another bank. They are all charging about the same rates right now, and the rates aren't going to increase much if any in the next few months. I just went through a refinancing myself. I had an appraisal. The whole process took maybe 30 days to complete.

I was under the impression that you almost always have to get an appraisal for a refi. When my wife and I first got our house, interest rates dropped over 1% within the month. That time we didn't need an appraisal since we had just gotten one while buying the house. This was a few years ago. We just finished our 2nd refi and had to get an appraisal.

I think the most frustrating part is when you are being told two different things from the same company, so sorry to hear about your misfortune.

I called the woman who made the address change and she was going to contact the two guys handling my refinance to ask why her address correction to the loan was not sufficient proof of address. She said this change gets verified by the county tax office. I also called customer service and asked to speak to their managers. Customer service called my loan processor and got his manager's name. Was told the manager was in a meeting so I got his voice mail, waiting on call back.

In the meantime I got emails from both of the men handling my loan. The one explained that the appraisal not only would verify the address but also provide home value and condition. Well I called him out on that. First I was told no appraisal needed, then I was told it was needed to verify the address, now I am being told it also will provide home value and condition information. He then told me yes, in this situation an appraisal is not usually required but the address conflict made it necessary, the home value and condition will just be part of the appraisal. Well, to me that explains it. They are looking for a reason to order an appraisal even though one is not required and the address issue was a perfect reason. Now that the address has been corrected they are sighting other reasons.

Bottom line, I was told no appraisal needed, I fixed the address issue, it no longer is an issue....if they now want an appraisal they should pay for it. At this time they have no justification to request one except to satisfy their concerns. Again, I was told no appraisal needed with this loan. By the way, the other loan officer is looking into that option of them paying for it.

What bothers me also is this is what they do. What turns out to be a reasonable cost in the beginning winds up costing much more. At this point they would have me close to $700 in cost BEFORE they even approve the loan. I have heard so many people get screwed this way, pay all kind of fees then have their loan denied or their refinance winds up costing hundreds sometimes thousands more than estimated. I am trying to cover MY ass.

The way I see it, you tell me this, don't change it to that later.

Thanks

JJL said:

He's covering his butt. And if you get the appraisal, don't be surprised if it feels like a prostate exam and then comes in low. They're all covering their butts now since they all got beat up after housing market crash. At this point I would weigh my options. The appraisal is $450. Although, you don't necessarily have to use their appraiser. You could shop around. I don't know how much you're into this already in terms of any up front costs, but you could just find another bank. They are all charging about the same rates right now, and the rates aren't going to increase much if any in the next few months. I just went through a refinancing myself. I had an appraisal. The whole process took maybe 30 days to complete.

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Do you think they really care to keep my loan? They should try harder if they do rather than threaten me to cancel the application if I don't do as they say regardless of the upfront agreement.

fergusmj said:

I was under the impression that you almost always have to get an appraisal for a refi. When my wife and I first got our house, interest rates dropped over 1% within the month. That time we didn't need an appraisal since we had just gotten one while buying the house. This was a few years ago. We just finished our 2nd refi and had to get an appraisal.

I think the most frustrating part is when you are being told two different things from the same company, so sorry to hear about your misfortune.

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I don't understand the exact reason but it has to do with it being a fannie mae or fanni mac backed loan. I believe it has to do with the market bottom dropping out and people underwater in their loans due to what they blame the banks for causing in the first place. I think it is a govenment bailout so to speak. I am sure the banks are not doing this because they want to, but because they have to. I mean if not for being a FM or FM loan given between certain years I would not qualify.

I feel bad for those who are underwater but don't qualify for that exact reason.

I have a buddy who bought his house on a short sale after the market crash. For three years he made an extra $200 toward his monthly payment so theoretically he was gaining ground on equity. When he went to refinance, his bank said they wanted an appraisal, so he paid the $475 to get one thinking it was just a formality and the cost of doing this kind of business. The bank sent out their guy, and the official appraisal came in almost $40k less than his loan amount. Obviously, the bank stopped his refinance and now he's kinda screwed.

When I refinanced, it was a streamline process, so the info defaulted back to the original paperwork and no appraisal necessary. In my mind, if they require me to jump through ALL the hoops, then I'm going to do it my way. Go to a mortgage broker. He will likely find you the best deal, and if he wants to get paid, he will make sure that the mortgage gets done. If your bank isn't ok with giving up your mortgage, then they will help you out a little bit on this.

jgln said:

Do you think they really care to keep my loan? They should try harder if they do rather than threaten me to cancel the application if I don't do as they say regardless of the upfront agreement.

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I don't think they really care much about it. It's getting to be more of a hassle for banks to generate loans. Not that this is a bad thing, but they were just rubber stamping everything up until a couple of years ago. Now they actually have to spend time researching the viability of an applicant. So as bad as it sounds, it's all about not writing bad loans (or at least showing they followed all of the rules) as opposed to customer service. Plus, if they're like most banks they really don't care about the loan itself. They are just trying to collect fees associated with the loan generation. They'll probably sell it off as soon as the ink dries.

OP - Start this same process with a different bank. 2 reasons 1. it will give you competing numbers and leverage. 2 the old bank doesn't want to lower your rate (although the loan officers get paid to close a new loan) but a new bank gets both the closing and the interest on the loan.

As for the 'no need to reappraise' that is a feature of the Federally backed loans (fanny and freddie). There are conditions like wanting to refinance for what you have already ie no equity or any changes. The address counts as a change, and there might be a serious issue there legally if that is true. Start going through your documentation of the previous appraisal and see if it has the correct address. Also check your prior closing papers and original loan info. When you go to a new bank, it will only care about that sort of stuff, not what your current bank has on file.

JJL said:

I don't think they really care much about it. It's getting to be more of a hassle for banks to generate loans. Not that this is a bad thing, but they were just rubber stamping everything up until a couple of years ago. Now they actually have to spend time researching the viability of an applicant. So as bad as it sounds, it's all about not writing bad loans (or at least showing they followed all of the rules) as opposed to customer service. Plus, if they're like most banks they really don't care about the loan itself. They are just trying to collect fees associated with the loan generation. They'll probably sell it off as soon as the ink dries.

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Part of the terms of this type loan is no appraisal needed and they all agree that is true. I am sure they want one and when they find a reason to demand one they do. The problem is depending on the appraisal it could kill a loan that would have otherwise been approved...all because of an address being a bit different. They don't want to refinance our loan and are looking for a way out of it.

ACbrewer said:

OP - Start this same process with a different bank. 2 reasons 1. it will give you competing numbers and leverage. 2 the old bank doesn't want to lower your rate (although the loan officers get paid to close a new loan) but a new bank gets both the closing and the interest on the loan.

As for the 'no need to reappraise' that is a feature of the Federally backed loans (fanny and freddie). There are conditions like wanting to refinance for what you have already ie no equity or any changes. The address counts as a change, and there might be a serious issue there legally if that is true. Start going through your documentation of the previous appraisal and see if it has the correct address. Also check your prior closing papers and original loan info. When you go to a new bank, it will only care about that sort of stuff, not what your current bank has on file.

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They don't seem to alarmed the address is different, they just want to order an appraisal as their way to verify the correct address, but I believe more importantly they want to appraisal to find the value of our home and possibly turn it down even though it was not required originally. Since the original loan papaers cannot be changed, only verifed for the correct address, I am sure no matter what bank I use this address issue will bite us. What happened is at the time of the original loan they took the address from the survey which gives the street address and township only (and block and lot which should be enough), it does not give the town. So they put the township where it says "town", that is the problem. I knew the township was correct so I didn't think much when I saw it on the line for town.

This small error made a refinance loan that almost could not be denied, deniable. They are looking for a way to deny this loan application and they think they may have found it. Even though the "reason" for the appraisal is only, and only, the address mistake, they no doubt will use any other information it may provide to them. IMO they should only be allowed to use the address information and not the rest against us.

I am going to let them do the appraisal, again since I am sure any bank will see the address issue and order on as well. I just don't want to spend what will be close to $700 is fees to find it gets denied.

If you're going to get an appraisal at least get your own guy. If you honestly think the bank is looking for a reason to deny your refinance, then it's not so hard to believe that they will hire someone to give them exactly what they want.

You've figured it out all by yourself! They are trying to deny the loan, plain & simple. Don't fight them, you won't win. 1st problem was..................... you went directly to the bank. Walk away. Go somewhere else.

Go to a Mortgage Broker. A reputable one. Get a referral. Someone who gets PAID directly to help you out. Just like anything there are good ones & bad ones. Find a good 1.

P.S. Appraisals are good for 3 months if you've spent $$$$. Make sure YOU get a copy of that item if you've spent for it.

Good Luck.

Slyko said:

You've figured it out all by yourself! They are trying to deny the loan, plain & simple. Don't fight them, you won't win. 1st problem was..................... you went directly to the bank. Walk away. Go somewhere else.

Go to a Mortgage Broker. A reputable one. Get a referral. Someone who gets PAID directly to help you out. Just like anything there are good ones & bad ones. Find a good 1.

P.S. Appraisals are good for 3 months if you've spent $$$$. Make sure YOU get a copy of that item if you've spent for it.

Good Luck.

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Yeah, what was I thinking. I thought they would have wanted to keep my business and it would be easier working with the same bank...but they already got my business at better terms.

I spent 2 mo. on this refinance with them and they already got me $235 into it between the application fee $35 and the second load subordunation agreement so I am going to give it a shot. I have the appraisal set up for tomorrow morning. If it doesn't go at least I should have a decent valuation of our home. I guess the problem is now is that since no matter what lender I go with they will request the original loan papers and see there is an address issues and request an appraisal. Even with the address correction on file with BOA I cannot change the original document.

I swear everyone at BOA is doing backflips to help me make this loan go through except the loan processor, he seems to be doing everything but that. Even the guy who took the application but he apparently has no power in the matter.

The appraisal..what a rip off. First off I have to pay for it even though it is not to provide me with information, only information to BOA that could be used against me. Second, they won't tell me how much I will be charged for it. All I got was an estimate from BOA. It could be more or less, I won't know until after the fact. Third, they won't tell me anything about my home, that is a secret between them and BOA. If I want a copy I must request from BOA. WTF?

If the bank wants to deny the refi all they have to say is, "no thank you". They are not required to refi your loan.

BOA is just a rotten company to work with in every way imaginable. If it makes you feel better at all, they treat their employees pretty much the same way.

ReverseApacheMaster said:

If the bank wants to deny the refi all they have to say is, "no thank you". They are not required to refi your loan.

BOA is just a rotten company to work with in every way imaginable. If it makes you feel better at all, they treat their employees pretty much the same way.

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Oh, I thought thr HARP program was some kind of government deal with certain banks that wrote bad loans and they had to comply. BTW, we are not a bad loan. We knew exactly what we were getting into and can make the payments, we just figured why not participate if it helps us.

I asked the attourney who went to settlement with us to review the paperwork. One interesting thing he told me was he spends most of his time getting people out of trouble they got into signing papers they did not understand. He also said BOA worst bank to deal with. His advise, as long as we are with BOA don't be late on your payment.

$$$$ talks & B.S. walks. Competition is the KEY. If YOU'VE spent $$$$ for anything............. get that anything, subordination agreement, appraisal, whatever. And go to a Mtg. Broker. Don't wait, run.

They've already shown you they know how to B.S. You've said it yourself.......................... they will be better off if they keep your loan as is. You've been making the payments, everything is honky-dory for them. Be careful since they know timing is the issue, they will try to forestall you again to keep the loan as-is. Don't worry about your original loan application, that is B.S. again. They are taking care of them. YOU take care of YOU!

This Bank is giving you B.S. Get you're stuff & GO TO ANOTHER REFERRAL. The clock is ticking.

Don't waste your time with a attorney. BofA has numerous attorneys ON STAFF. They write their own rules and I've seen them tell the Government F.O. in the past.

Do not spend any $$$ for anything until they give you something in writing. IN WRITING is key. You've already been stung....................... now make them perform before you do or spend anything else.

Good luck.

I've always felt there is a special place in Hell for Bankers and child molesters.

People have nailed it...the bank makes the rules. You obey or drown.

I don't know how much you're into this already with regards to any in advance side expenses, but you could just discover another financial institution. They are all asking for about the same prices right now, and the prices aren't going to improve much if any in the next few several weeks.

jasonsbeer said:

I've always felt there is a special place in Hell for Bankers and child molesters.

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You left out insurance companies and lawyers.

And people who talk in theaters.

I decided to continue. I figure if an address conflict will require an appraisal I will probably run into the same issue with any other lender. That and the whole process was very draining on my nerves and I don't want to have to go through it again. I am getting 3.5 APR which I think is fair, over 2% less than we have now and for 10 years less term.

Anyway I got the appraisal done and all he found was the lack of a railing on a section of our deck so I installed railing, looks much better anyway. But the thing is the township said it was fine when we bought the house, it met the height (or lack of) requirements but it wasn't worth another battle for $80 of wood and a few hours work. I spoke to the bank and they said other than that the appraisal looks good and he will be sending the loan to closing and will notify us soon to set a closing date.

If I ever do this again though (another home, whatever) I may shop around some and be more apt to walk if I don't like what I see but for now it seems like it is going to go through without any more issue.

Thanks!

Closing is done and I got notification it is a done deal. We shortened our term by 10 years and our payments per month are about $800 less. Can't decide if we will keep paying what we paid before (another $800) to pay it off faster or just save more but either way we will be paying more than the payment to help pay it off. We have no plans of moving, possibly ever.

I doubt I will ever do this again but if I do at least I know what to expect so maybe it won't be as bad. I thought closing would be easy but I believe we signed just as many papers as when we bought the house. I must have signed my name 30 times at least. Took about 45 minutes.

Congrats! The extra payments on the principal will save you a bundle in the long run.

SharonaZamboni said:

Congrats! The extra payments on the principal will save you a bundle in the long run.

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Thanks! Only problem is I think the whole process and the arguing also took 10 years off my life expectancy. lol