Over the last couple days, things have been happening so fast I've been having trouble keeping up. Let's see. First of all, there's the news that we finally received some paperwork from our new mortgage company (Northeast Finance) after being assured that they would meet all the rates from the last mortgage company (Family First) who was working with Bank of America but was unable to make the loans they promised us happen. Raegan and I didn't suspect any foulplay, especially once we found out the two people we were dealing with not only worked together (Bill Shaughnesy (or maybe Shaugnessy for those of you doing a Yahoo search) who owns Northeast Finance and Phil from Family First) but that Bill was and still is Phil's boss. Confused? Read on.
When we got the "good faith" paperwork, all that Phil had promised us had changed. Firstly, the home-equity loan, which would cover our balance had also been changed from a Fixed loan at 6.5% (which Family First had promised us) to a Variable Rate loan. Secondly, they had upped the interest rate on our big loan from 5.5% to 5.65%. Which works out to approximately $20,000 over the course of the loan. Not a huge change, but certainly enough to sue over, wouldn't you think?
Naturally, Bill's distanced himself from Phil, and doesn't consider himself responsible for Phil's screwup, because apparently Phil was working for two companies (his own, Family First, and NorthEast Finance) at the same time. Pretty confusing, huh?
It all seems somehow, shall we say, negligent? Well-orchestrated to say the least, like a fine bait-and-switch operation. Think of it this way: first, you have one of your subsidiary companies (say, Family First) offer up a loan they know they will be unable to fulfill in order to attract the client's business. Then, at the last minute, you have the father company (say, Northeast Finance) come in and seemingly save the day by promising to provide identical rates, but then, at the very last second, actually not. Bill at Countrywide actually said to us "a fixed rate home equity loan at 6.5% doesn't exist. The product just isn't out there."
"What do you mean," I said. "Just make it up. It's just numbers, right? It's not like buying a pair of pants. Just do the math."
"I can't do that"
"Well, maybe you can answer me this. If you presumably got all the details from the last guy, him being Phil, your employee. And you read that he was offering us a fixed rate home-equity loan at 6.5, why didn't you tell us right away that that particular loan didn't even exist? Why is this coming out now, at the very last second, when there's nothing we can do about it without losing the house?"
To which he literally replied:
"I don't have an answer to that."
"I mean, particularly after you asked us for all that other crap — our taxes and an income statement and a letter from our accountant? You'd think you could've taken a moment to let us in on a few minor details, right?"
"I still don't have an answer for you."
"And if Phil is your employee, wouldn't you feel obligated to offer us the same rate you were offering us before, the rates we locked-in at?"
"I can't. Even if I wanted to, I couldn't. Rates have gone up since that last loan was processed."
It's really quite brilliant when you think about it. And the best part about it is it all seems so darned unrehearsed. Problem: How to 'un-lock' a client's interest rate when they're buying a home in the midst of rising mortgage rates? Simple. You just pull the loan out from under them and reprocess it! Lock problem solved!
On the bright side, in this world of widespread corruption, what with Enron and Halliburton, it makes a guy feel special to know he got his own little taste of the action.
Here's an interesting side note: I just found an old note from our agent. It says he wants us to use his attorney, that doing so will make things easier for us, save us money, etc., but the only thing we won't be able to do is to, get this, sue our mortgage company! Though he says that "almost never happens." Hmmmmmm. What do you know about that? Let's listen in to our agent's soon-to-be-famous last words.
When we got the "good faith" paperwork, all that Phil had promised us had changed. Firstly, the home-equity loan, which would cover our balance had also been changed from a Fixed loan at 6.5% (which Family First had promised us) to a Variable Rate loan. Secondly, they had upped the interest rate on our big loan from 5.5% to 5.65%. Which works out to approximately $20,000 over the course of the loan. Not a huge change, but certainly enough to sue over, wouldn't you think?
Naturally, Bill's distanced himself from Phil, and doesn't consider himself responsible for Phil's screwup, because apparently Phil was working for two companies (his own, Family First, and NorthEast Finance) at the same time. Pretty confusing, huh?
It all seems somehow, shall we say, negligent? Well-orchestrated to say the least, like a fine bait-and-switch operation. Think of it this way: first, you have one of your subsidiary companies (say, Family First) offer up a loan they know they will be unable to fulfill in order to attract the client's business. Then, at the last minute, you have the father company (say, Northeast Finance) come in and seemingly save the day by promising to provide identical rates, but then, at the very last second, actually not. Bill at Countrywide actually said to us "a fixed rate home equity loan at 6.5% doesn't exist. The product just isn't out there."
"What do you mean," I said. "Just make it up. It's just numbers, right? It's not like buying a pair of pants. Just do the math."
"I can't do that"
"Well, maybe you can answer me this. If you presumably got all the details from the last guy, him being Phil, your employee. And you read that he was offering us a fixed rate home-equity loan at 6.5, why didn't you tell us right away that that particular loan didn't even exist? Why is this coming out now, at the very last second, when there's nothing we can do about it without losing the house?"
To which he literally replied:
"I don't have an answer to that."
"I mean, particularly after you asked us for all that other crap — our taxes and an income statement and a letter from our accountant? You'd think you could've taken a moment to let us in on a few minor details, right?"
"I still don't have an answer for you."
"And if Phil is your employee, wouldn't you feel obligated to offer us the same rate you were offering us before, the rates we locked-in at?"
"I can't. Even if I wanted to, I couldn't. Rates have gone up since that last loan was processed."
It's really quite brilliant when you think about it. And the best part about it is it all seems so darned unrehearsed. Problem: How to 'un-lock' a client's interest rate when they're buying a home in the midst of rising mortgage rates? Simple. You just pull the loan out from under them and reprocess it! Lock problem solved!
On the bright side, in this world of widespread corruption, what with Enron and Halliburton, it makes a guy feel special to know he got his own little taste of the action.
Here's an interesting side note: I just found an old note from our agent. It says he wants us to use his attorney, that doing so will make things easier for us, save us money, etc., but the only thing we won't be able to do is to, get this, sue our mortgage company! Though he says that "almost never happens." Hmmmmmm. What do you know about that? Let's listen in to our agent's soon-to-be-famous last words.
posted by the Brykmans at 5:17 PM
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