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  • Report: #153984

Complaint Review: Centex Home Equity

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  • Submitted: Wednesday, August 17, 2005
  • Last Posting: Monday, August 29, 2005
  • Reported By: — Denver Colorado
Centex Home Equity
centexhomeequity.com Denver Colorado 80202 U.S.A.
  • Phone:
  • Web:
  • Category: Loans

Centex Home Equity ripoff, Denver Colorado


1Author 0Consumer 1Employee/Owner

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I am an employee of Centex Home Equity in Denver, CO. Currently seeking a new company that has at least some ethical standards. The company hires mostly young kids out of college or older people with no mortgage experience or knowledge; the reason they do this is because of the deceptive lending practices they teach and predatory lending that they use against unknowing or uneducated borrowers seeking a loan.

I had worked at several mortgage companies and have never seen anything like it. The company makes a common practice out of trying to sell subprime loans to individuals with perfect credit. The company charges 5 points on the front of every loan and usually 5 points built in to the back of the loan with the astronomically high interest rates.

If you choose to do a loan with Centex you will, without a doubt, be given the highest interest rate and points of any lender in the business. The company also makes a common practice of using 5 year prepay penalties if your state allows it. Meanwhile they sell you a loan only fixed for 6 months or 2 years. They tell you that once your credit is improved they will waive the prepay penalty and give you a new loan: Wrong, they won't and illegal.

Bob
Denver, Colorado
U.S.A.

This report was posted on Ripoff Report on 8/17/2005 10:51:08 AM and is a permanent record located here: http://www.ripoffreport.com/loans/centex-home-equity/centex-home-equity-ripoff-den-ae79f.htm.

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1Author 0Consumer 1Employee/Owner
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#1 Employee

HERE ARE THE FACTS

AUTHOR: Former - TEMPE (U.S.A.)

SUBMITTED: Monday, August 29, 2005

I was a branch manager for Centex Home Equity. I am here to tell you that they have a phrase for new susceptable borrowers. It's called "Clubbing a baby seal." This company scours the internet through various internet marketing companies (i.e. Loan Web, Lower My Bills.com, and Lending Tree) looking for borrowers uneducated in the mortgage lending industry. They use terms like accelerated interest, fresh start, and tax shelter to lure potiential borrowers that actually believe that they have no other option.

Most direct lenders and brokers aim to make 3% on a loan through points and SRP (service revenue premium.) This means on a $300,000 loan, we earn $9,000.00. Typically 50% of that fee goes for overhead and the rest is commission to your mortgage banker.

Centex has a target revenue of 8.5%. This means on a %300,000 loan, their target profit is $27,500.00. This is an unwarranted profit considering they are simply refinancing your home. Consider the fact that you might actually be giving up nearly 10% of your equity! What's more is that your loan officer only makes typicaly 1% ($3,000) of your loan volume ($300,000) in commission- for the example I used earlier. So not only are you getting ripped off, but your loan officer gets robbed as well.

If you are actually naive enough to consider using Centex Home Equity, follow this advice:
1. DO NOT PAY FOR AN APPRAISAL.
If they want your business badly enough, they will fund your appraisal for you.
2. Make sure you receive a Good Faith Estimate. Take your GFE to another mortgage professional and see if they can do any better. I promise you, you will be surprised by the results. Fact is, as a mortgage banker, I can get a loan approved through Centex Home Equity for 1/3rd the cost if you go through them directly!!!! Don't believe me.... Try it.
3. JUST DON'T DO THIS TO YOURSELF. You are going to get ripped off. No matter how bad you think your credit is... an experienced mortgage professional will know how to handle your business and get you qualified for a REASONABLE fee.

Kodos to the gentleman in Denver.

FORMER BRANCH MANAGER
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