We hired Morgan Humphrey to procure a loan for some property in Kyle, Texas that had a mobile home located on it. I was preapproved and he had all of the paperwork drawn up for closing, via Kristin Alvarez of ERA corporate office (she was underwriting the loan.)
The seller of the property live in Marshall Islands. We paid for an official inspection of the home (not an appraisal), and the inspector found that there were issues with the septic system and the foundation. If these were not remedied, I would not qualify for an FHA loan and therefore would not be able to purchase the property. My ERA realtor contacted the seller's realtor who relayed the information. The seller decided that they would not repair the problems. My realtor emailed Morgan Humphrey, during this process, and let him know that we would not be needing the appraisal that he had been trying to initiate, due to the fact that the sellers would not agree to make the needed repairs that would allow the loan to go through.
I was still in the opt out period, so we proceeded to look at other properties. We found some raw land in Kyle, and I emailed Morgan to ask if he could help finance raw land. He stated that he was unable to finance raw land. So, I thought that at that point our professional relationship had ended. He was notified that the deal was not going down in the middle of August 2012.
At the end of the month, I noticed a $415 charge from ERA mortgage. I immediately called Morgan to inquire about this charge, and he told me it was for the appraisal. The appraisal that my realtor had emailed him not to do, a few days prior to his ordering it. I was surprised and asked him why he ordered the appraisal after he had been instructed not to, and he didn't have a reply. In fact, he wouldn't respond to any of my phone calls after that date.
I forwarded him a copy of the email he received instructing him not to order the appraisal, and I implored with him to settle with me so that I didn't have to dispute the charge through my bank. He didn't reply. I pursued a dispute through my bank, USAA.
A couple of months later, I contacted my bank and realized that they had taken the disputed amount of $415 from my account. I inquired about the dispute status and findings. They told me that ERA mortgage had produced a document that I esigned stating that there would be a nonrefundable application fee of $415. He also produced his $495 receipt to USAA to prove that he wasn't just trying to recoup the appraisal fee. The appraisal that both me and my realtor and verbally and virtually told him not to order!
I called corporate office in New Jersey and spoke with a Mike, who told me he was Kristin's boss, but not Morgan's so he could not help me. I told him that I would have never signed a document for a real estate loan transaction stating that I would be paying 415 dollars, regardless of the outcome! I have bought and sold real estate before and know that there are many potential pitfalls in the process. I have never paid for a loan application fee in all of my life, because I haven't ever made offers or bought property valued over 100, 000. This particular property was 87,000. This situation was especially precarious, because we knew that the seller lived outside of the US. Either Morgan had not disclosed all of the information to me that I signed, or era has fabricated a document.
After further pressing Mike, I learned that this "standard fee" is rarely collected from clients who close. It is generally used to recoup lost appraisal fees, which brings me back to my complaint.
I have been charged for a service that I specifically ordered not to be done. I have an email to Morgan from my realtor attesting this. His appraisal was ordered the following week after the deal was terminated. He was supposed to be working for me; instead I feel he was trying to line his appraisal buddy's pocket, or he is just severely incompetent. Either way, my family has had to pay a fee for land that we didn't buy for an appraisal I didn't order. His defense, I signed a document agreeing to pay an irreversible fee of $415 for the loan application process. I have not seen this document, but if it is esigned, the information was obviously not disclosed to me at the time of signing.