re-finance nightmare

Anonymous · ‎02-09-2009

We went to mortgage broker last week, to re-finance our mortgage loan.

We owe $62,500 and thought the home would appraise for $85,000.

Our scores are 650's.

She said she could give us $5,000 cash back for home improvements and could lock us in at

5.5% or we could “float” and she could hopefully get us into the 4% margin for an FHA Loan.

She told me to email her every day for the daily rates, which I did and she never replied to. Also, she went ahead and ordered the appraisal. She said appraisers are really busy, well, I got the appraisal done last Thursday (within 4 days)… house appraised for $81,000 (since we only owe $62,500 we should be ok since we have 20% equity) She said the appraisal would be $400.00 and would include in closing costs.

Mortgage broker finally called today and said supposedly there is a new FHA rule (all of a sudden) and now she wants us to pay for a 2nd appraisal also due to Loan to value and she hasn’t sent anything to underwriting yet.

I am so upset. I can’t believe she could do that, I told her she explained we were already approved and would only need 1 appraisal as long as the value came out ok. Is this really a new FHA rule?? Told her I wasn't paying for 2 appraisals and that I would just go with my credit union if she really has to have 2 appraisals.

My credit union will approve us for 5.875% on 25 year loan, no cash back, but conventional loan and will not have to pay PMI, but at least it will be less of a loan amount, automatically deducted, etc. We are going to meet with the credit union on Wednesday.

Can they can use the same appraisal as I just had done since it was for an FHA loan and now I would be going conventional? She emailed me the appraisal and it indicates that she is making $250.00 referral fee off of it. Am I obligated to pay the total $400?? Please help.

Anonymous · ‎02-09-2009

I do not know if it is a new rule or not. I am in the process of getting a FHA loan as of 2/3/09 and I had to get 2 appraisals.

DallasLoanGuy · ‎02-09-2009

we order a lot of appraisal reviews. but i have not had to get 2 appraisals for any of my deals.

this is NOT a new fha thing.

Retired Lender

Anonymous · ‎02-09-2009

well should I be obligated to pay for this appraisal since she told me I only needed one appraisal and now she wants 2 appraisals.... she is the one who is changing it because of this "new rule" she says.

also, she is getting a $250 referral fee... so do I really have to pay her $400 for the appraisal or should I only have to pay her $250.

Anonymous · ‎02-09-2009

Well, I don't know about a 'new' rule from FHA, but I was informed early in the process that FHA would require its own, approved appraisal if I sought an FHA-guaranteed loan. Thus, I didn't arrange one myself, but let the broker do it at an appropriate time by an appropriate party. I suspect if an agent/broker ordered one by a non-FHA-approved appraiser, they'd want another one.

Anonymous · ‎02-09-2009

To answer some of your questions:

1. Typically you cannot use the same appraisal for 2 different lenders. I believe it is in violation of the appraisers code of conduct. However, I have seen instances where it did happen anyway. Keep in mind that the level of ethics & conduct vary from one person to the next.

2. It was my understanding that the appraisal is a cost of obtaining a new loan and if you did not obtain the new loan then you also did not incur the cost. This may or may not be true - but this is the reason I have my own clients pay for appraisals directly to the appraiser. When they do not pay, I'm always stuck with the bill.

3. The 2 appraisals on FHA is starting to become a problem. It is usually required for cash-out loans higher than 85%.

Here's some examples:

http://forum.brokeroutpost.com/loans/forum/2/256295.htm

http://forum.brokeroutpost.com/loans/forum/2/252515.htm

http://forum.brokeroutpost.com/loans/forum/2/213518.htm

These posts are from the point of view of brokers - but you can get the general idea.

4. I believe it is illegal to be charged twice for appraisals on the same home. This is one of the reasons that brokers are upset about the change also. They have to pay for the other appraisal - even if the client changes their mind.

DallasLoanGuy · ‎02-09-2009

@Anonymous wrote:
well should I be obligated to pay for this appraisal since she told me I only needed one appraisal and now she wants 2 appraisals.... she is the one who is changing it because of this "new rule" she says.

also, she is getting a $250 referral fee... so do I really have to pay her $400 for the appraisal or should I only have to pay her $250.

i missed the cashout part earlier. sorry that she didnt tell you that.

regarding the fee.... i don't think she can charge you more than the cost of the appraisal.... so, in my opinion, you would pay cost, not an inflated cost because of a referral fee. you might want to pose this question to hud and see how they feel about it. it 'may' be illegal what she is doing. http://www.hud.gov/offices/hsg/sfh/fharesourcectr.cfm

you canb contact hud thru th link above

Retired Lender

Anonymous · ‎02-11-2009

Hi everyone, thanks for your replies

Dallas, thanks for the link -- I have emailed them to ask them if I should have to pay the $400 for the appraisal at all, or if I should only have to pay the $250 , so I will let you know what they say.

I called the mortgage broker back and told her we are not paying for another appraisal. She said she would have to find out if they needed a second one or not and needed to find out so that they "don't spend 2-3 hours on my loan and then me not take it." Do you loan underwriters/officers really spend that much time on 1 loan or is she just trying to make me feel bad???

We went to our local credit union today and I think they can do a conventional loan on 25 years for 5.875%. Do you think that is a good rate?