Posted on: 07th Oct, 2009 08:00 am
I began process for construction loan. Was quoted a 6% rate and told there would then be a "take out" loan at rate the then current. I submitted application and all docs and $500 fee (fee and for appraisal). Then I received the good faith estimate and asked to sign it. It had an interest rate of 7.5% and when I inquired about the rate and the take out loan details, I was advised the take out loan would be with a different lender AND as a new loan it would be subject to new points, fees, etc. My question: I don't want this rate or this 2nd loan arrangement with double fees and points and the interest rate is much higher than quoted - and will not sign the good faith estimate - so can I get my fee back?
you might have to fight like a dog to get it back, but in this case, i'd say you should do so.
Thank you for your reply. I was thinking of only asking for the portion of the fee which was to go to the appraisal which has not yet been made. That would seem to me to be fair as that obligation was not paid out from the $500 and I am OK with letting the lender have the rest - despite what I consider less than candid disclosures - for any work they put in, i.e., sending me the app and reviewing what I sent back etc.,
As George noted, start barking.
Ask for the entire fee back, especially if appraisal not done and not paid for, in hopes of getting entire $500 back and if you get back less, well, you already volunteered that would be ok.
Ask for the entire fee back, especially if appraisal not done and not paid for, in hopes of getting entire $500 back and if you get back less, well, you already volunteered that would be ok.
so many of us do all that groundwork for nothing that i see no reason for you to give it to them, particularly given the circumstances.
now how about convincing all of my customers that all of the work i do warrants compensation, even if no deal actually ends up being consummated...that would be a lovely idea, i think.
now how about convincing all of my customers that all of the work i do warrants compensation, even if no deal actually ends up being consummated...that would be a lovely idea, i think.
Sign me up for that George ! Sometimes I feel like I am running a free clinic.
Thanks again for input. I will call the loan officer (at a bank) and see what I can work out. The appraisal was not done yet as it was to be based on the blueprints (construction loan) and plans just came in for part of the project only. I have no problem letting the bank keep the part not reserved for the appraisal as that is not entirely unfair and may expedite a resolution. If they are going to not refund anything then I have a real problem and will do whatever I can to get that back. I like the advice about asking for all of it as that gives us some wiggle room and something to discuss.
Construction loan? There is a good chance that there was a mis-communication between yourself and the loan officer regarding the many stipulations and requirements to obtain this loan. OR, the lender changed the guidelines after your initial discussion with the loan officer.
No - no miscommunication re the construction loan aspect - one of the contractors I was talking to referred me to this bank as one which did a lot of construction loans in the area. We were discussing "breaking ground" dates, review of the blue prints, and etc etc. And I knew the construction loan would change into a 30 year loan at some point at the then current rate - they said they would do all that. What I was not told was that the 30 year loan would be an entirely new process and they would be going to a different lender and that loan would have new points and fees etc. Also told the interest rate would be 6% for construction loan and then would be whatever was then the market rate for the 30. What I should have done is asked for the good faith estimate sheet breakdown before I paid the $500 fee. Hopefully, I can get back the part of the $500 that was to go for an appraisal. . .