Need some guidance......long and I am sorry

[teddingt]

And I apologize now for this being long.

It all started last August, I spoke with a builder and decided on a home.

Got in touch with a loan originator that is local and a long time friend to start the process. I was given a ridiculous loan amount of 145k, which I thought was high for my wage (14.00 per hour) but was hoping that since I did not have any debt to speak of just a couple of low card payments that maybe my DTI was getting me a higher amount. I decided on a USDA guaranteed loan for the usual reasons, nothing down and 102% financing and low rates. I also informed her I have a low amount (3k) student loan in default from 1988 it was not showing on my credit report but I thought it would show on CAIVRS. My credit was ran 630's mid score and some stuff in collections. It went to underwriting and I was told to take care of the collections.

I asked at this time about CAIVRS and was told again it was clear so I thought yay! its all good. Jump forward about a month and a half, I have the collections all paid informed my friend get an email back with “Oh sorry the overlays have changed and you have to have 6 months payments in reserve” so you don’t get this loan. I informed her that USDA does not require reserves but was told that they may not the lender does. I accepted that because I new that USDA backed the loan but the lender put out the money so I took it a face value. I told the builder this who was not happy but was okay with it since housing has boomed in our area and was able to sell.

I go back to the originator and ask what is next, she tells me to get my score up to 640 so I could go through automated and find a less expensive house and we can try again. Keeping in mind that open RD loans are only available in my area (Joplin Mo.) until September of 2013. I get my mid to 644.

Fast forward to February. I find a house that is less expensive 119k and start again. I again ask about CAIVRS and get the same answer “clear and good to go”. I make it through junior underwriting and was told they are going to order the appraisal. Since I am still worried about CAIVRS I email her and tell her to check again because I don’t want to pay for the appraisal if the loan is not going to go through. I get the “Everything looks great” reply email. It goes to the senior underwriter who low and behold on the day it is to go to USDA actually looks at the CAIVRS report and sees the Department of Edu on it.

I get an excited email from my “friend” say I need to call the Department of Edu and ask them to remove me from CAIVRS as I am making payments. I ask her for the report so I can have a file number and I make the call was informed that I have to make the 9 payments or rehab the loan and those are my only options at this time. I started the consolidation process then I actually look at the report. It was ran 14 days before they asked for the appraisal. I email her back telling her what I saw and was told that she doesn’t actually look at the report due to federal regs and that when it was done in August of last year it was only a soft pull. I am livid at this point remind her of the emails saying they would not take the money for the appraisal knowing it wont go through and I ask about the junior underwriter not seeing it. Was told that according to federal guidelines it is only looked at in the end by the Sr underwriter. But my “file” was sent to USDA anyway and maybe they wont see it.

Since I think she is not being truthful I ask for the log number where my file was received by USDA. 3 days later I get the “oh it wasn’t sent after all” I immediately ask for a refund emailing her and the owner of the mortgage firm she works for. And get a call saying its been at USDA and they have said Ok pending a clear CAIVRS and it is up to the lender to decide if they want to make the loan. I did some internet research and found training documents from USDA saying basically the same thing. That the debt needs to be resolved but not to expect a clear CAIVRS due to the time it takes. Still sort of believing her she tells me its now up to the lenders. But so far no one will touch it with out a clear report. Well the seller decided not to wait on consolidation and put the house back on the market. I understand it takes 30-60 days to consolidate.

My questions is … Is it unreasonable to expect a refund. Can I report this? And since it will open a new trade line if I consolidate should I wait out the rehab (July). My problem is I am to close and emotional about all this I am not thinking clearly. And I could use some sound advice.

Thanks

Tracy

 Broke your post into paragraphs to make it easier to read

Shogun, myFICO moderator

[JM-AM]

First advice while I understand you know her, you need to take your business to another LO or Broker.

Its one thing to really not understand something and be upfront by saying let me try and find out since I am unsure. Especially since its a friend. But it doesnt seem like your friend is being forthcoming.

If I was in your shoes I would wait it out for the simple reason you do not want the new trade line and INQ to ding your scores to the point you will have to bring them back up again. July isnt all that far off and gives you a little more time to shop a home again, just dont fall in love with one yet.

[teddingt]

Thanks,  Does it sound like I might have a grievance against the LO to maybe recover the appraisal fee?

[webhopper]

Generally, once you pay for an appriasal... you dont get that money back... because you're paying a third party