What? I never paid my Bank those Closing Costs!
As a Licensed Mortgage Broker I make sure my clients fully understand all of the papers they are signing plus the Mortgage and the Good Faith Estimate. When meeting with a client yesterday that was referred to me for his refinance of his property for a 3rd time (all no cash outs just redoing the ARM) I went over all the papers as always including the Good Faith Estimate and this is when the client was shocked to see what my closing costs where of his new mortgage. He went on to explain to me that he never paid that much before and why was I so high.
Going over the Good Faith I explained that I always figure high so that he would never have any surprises at closing. In addition I had listed full price on his Title work as well as the appraisal. If he could provide those two items he would receive a discount and then be able to lower his closing costs.
Still being shocked at what closing costs where and wanting to receive a discount he provided me his last two packages that where given to him from his title company. To see if I could find the Title work as well as the appraisals. In these packages I came across the Good Faith Estimate provided to him from his Bank and yes the client was telling me the truth. His bank was considerable less than what my Good Faith was showing him. HOWEVER, I went on to find the Closing Statement (HUD)
SURPRISE, SURPRISE, SURPRISE
When reviewing the true closing costs of his Closing Statement versus what my Good Faith Showed I was less than $300 off. In addition, I had listed full price on his Title Policy as well as the Appraisal. So in actuality I was right on the true closing costs of his Mortgage. No lies or sales tactics but the truth. After pointing this out to the client needless to write the application was signed and we are moving forward with his refinance on a FIX rate product. (No more refinance for him)
When people tell you that they only deal with Banks please keep in mind Loan Officers at Banks are both good and bad just like Mortgage Brokers. Don't let people give you advice in the absolute by making statements like Only Dealing with Banks will protect you. The truth is nothing beats a satisfied client who gives a referral and in this case that is exactly how this client found me.
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Matt, Don't you just love it!?! I love the ones that try to hide their fees or low ball the mortgagee. I always work on the high end and tell people that I don't like surprises and I'm sure they don't as well.
Doesn't it feel great when people you can show people that you actually ARE right on the money. In addition, you get the added benefit of being more honest than the last person they dealt with. When you do the right thing, you get to reap the benefits. Well done.
Marc, Exactly don't you love it! Or What I like is people who don't know what they are talking about giving advice.
Martin, You do feel great when you know you where right and can prove it.
Rock on, Matthew! I LOVED this story...
Ah, the old bait and switch!
Sherri, Thank you.. I will!
Rey, I agree... Don't you love it!
Matt,
Glad to hear you stuck to your guns and won this one. Most borrowers wouldn't know an accurate GFE from one that conveniently has fees lowballed, pre-paids underestimated, etc. I work the same as you and make my GFE as accurate as possible so there are no surprises at closing.
Every lender must have a fee of some sort... can't just work for free.. gotta eat..
Cheryl, This is why we get along..:-) we work a like
Robert, exactly!..Thank you
That's a great story and a perfect example of what happens all the time in our business. Thanks for sharing that!
Hey Matt, that's crappy. I can't believe people do that. I'm glad that you were honest and able to show him the difference. I know I would trust you with my clients!
Thanks Matt :) It's frustrating to deal with this. At least your borrower had the documentation so you could show him the real deal.
I wish the borrowers would understand how things work. All they want is GFE and APR and go with the lowest quote, having no idea. Then they sign at the table even though the fees are higher because they don't want to start over again or they are purchasing and have no choice.
Katie, Thank you for the comment. You are right it happens all the time
Stephanie, Thank you..<blush> I know I can look at myself in the mirror in the morning...
Cheryl, So true they just sign and move on.. not happy but they do it all the time.
But how did he not understand he really paid the costs when it was on the HUD1? I don't understand folks sometimes! Good for you for getting him to understand...
Josette, People remember what they want to remember..:-) Thank you for your comment
Well, if it works that way... I'd like to remember that I weigh 118 pounds and am young and cute. Think it'll work??
Jesette, Works for me..:-)
Seeing the light can mean large changes. Glad you were able to help him out. :)
Keith & Robin, Well we did not close yet..but it is an easy file and should have no problems.thank you