• Report: #684646

Complaint Review: WWW.MortgageProfessor.com - Amerisave

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  • Submitted: Thu, January 20, 2011
  • Updated: Sat, June 11, 2011

  • Reported By: eloanpro — wheeling Illinois USA
WWW.MortgageProfessor.com - Amerisave
Internet United States of America

MortgageProfessor.com - Amerisave He has 2 other names. Deceptive Mortgage Advertising and a Bought and Paid for "Award" to mislead clients --"Up Front Mortgage Broker" Internet

*UPDATE EX-employee responds: Former employee...

*General Comment: not a fair indictment

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The first 2 words in the caption above are 1. Rates, and 2. Points. How much are they charging? I would assume that an Up Front Mortgage Broker would let you know their fees Up Front.

Then when you look at Amerisaves rates as posted on BankRate.com as of 1/20/11 their FHA 30 year fixed rate is 4.25 with an APR or Annual Percentage Rate of 4.806. What most people dont understand is that APR is much higher because it is calculated based on the true amount of money a consumer is borrowing vs. the actual loan amount less the fees being charged. I know it can be confusing, and that's confusion it is what predators use to distract their prey. In this 1/20/11 example below the APR is more than a point higher than the rate. This means the consumer is being charged fees which are not disclosed Up Front.

The only thing Up Front about the Up Front Mortgage Broker Award is that the Mortgage Professor has a disclaimer stating he gets PAID by Amerisave.


This report was posted on Ripoff Report on 01/20/2011 07:41 AM and is a permanent record located here: http://www.ripoffreport.com/r/WWWMortgageProfessorcom-Amerisave/internet/MortgageProfessorcom-Amerisave-He-has-2-other-names-Deceptive-Mortgage-Advertising-an-684646. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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Updates & Rebuttals

#1 UPDATE EX-employee responds

Former employee...

AUTHOR: marketleader - (USA)

Previous post is correct. The Mortgage Professor is a very well respected individual and advocate in the lending industry so I'm not sure why this person is blasting him or Amerisave specifically.



Why is he blasting Amerisave specifically? Every other lender on BankRate advertises rates exactly the same. That's just how BankRate.com post them, all of which are in compliance with regulatory standards.



This angry client obviously hasn't read The Mortgage Professor's disclosure completely nor did he/she read what exactly an "Upfront Mortgage Lender" is. It simply means that they guarantee and honor at closing exactly what you were quoted or "locked" at the time of your application. This has nothing to do with them advertising what rate and APR is available under a certain scenario on BankRate.com in which all of the other lenders are using to advertise as well. Also, the professor clearly discloses that he is only paid by Amerisave for any referral business which is natural in any industry.



Amerisave doesn't pay him for the certification. They go out of their way to qualify for the certification. He also discloses that his funding came from a federal grant. He was able to get the grant by making this improvement to the industry and improving it's standards which Amerisave was being proactive by participating. It's obvious that this grant to the professor was a wast because people such as yourself can't read disclosures properly or comprehend them.



By the way guy, it's not an "award" but rather a "certification" requiring the upfront lender to go above and beyond what was required by law at that time. Now however, any lender in existance is technically a "Certified Upfront Lender" because of the new requlation that forces lenders to honor within an extremely small percentage at closing from what was actually quoted or locked. This new RESPA and GFE regulation passed on Jan 1, 2011. So prior to that it means that Amerisave already was practicing those compliance standards before they were required by law. I know this for a fact because I worked there and it was a pain in the butt dealing with it first hand.



What's also funny is that this guy explains what he thinks APR is which ironically happens to be wrong. APR is calculated by recalculating the interest rate using the same term and payment but after subtracting the associated fees from the loan amount. The only way to do this calculation is the solve for "N" by using a financial calculator. "N" being the interest rate. Yes it can be confusing not only for this guy (LOL) and other cunsumers but also for people that even work in the lending industry. It's sad but true.



He then goes on to claim that lenders show APR in order to "distract their prey." LOL...In reality, lenders show APR because it's required by law and they have no choice but to disclose the APR whether they like it or not! Lenders actually hate having to disclose APR because of the fact that it is confusing to consumers and it's very difficult to explain it to ignorant people like this guy. The FED created APR in order to force lenders to reflect the cost of the loan in a uniform and measurable way in an attempt to give consumers a quick and easy way to shop the best offer. 



In simple form, assuming lender A and B are offering the same rate with all other parameters being the exact same then the leander with the higher APR is charging more fees than the competing lender. It doesn't tell you how much more unless you know how to solve for "N" and calculate APR properly on a financial calculator as I showed above.



The FED designed the process because of the fact that lenders charge fees in different ways and then name those fees different things. So APR allows you to compare lenders at a quick glance but you still need to compare them in detail by totalling the lender and 3rd party fees. However, if you are not comparing lenders then APR is worthless and means literally nothing. Also, APR is not a real rate it is simply a measuring tool. It is not associated with your payments or interest in any way shape or form.



I know it's complicated but these are the facts. And I hope this reply helps educate people on different aspects of APR and why things are the way they are. Reading disclosures helps as well. :) loll
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#2 General Comment

not a fair indictment

AUTHOR: Chuck F - (United States of America)

Not sure why this complainant is implicating The Mortgage Professor for Amerisave rates that are posted on BankRate.com.

The Professor's arrangement with Amerisave only applies to borrower's accessing Amerisave through his site - www.mtgprofessor.com, not through BankRate.com.

This complaint was reported by someone using the username of "eloanpro". If s/he is a "eloan pro" then s/he would know that FHA loans include both an upfront and a monthly mortgage insurance premium which can greatly impact the APR. These are not undisclosed fees.

I have had many dealings with The Mortgage Professor over the past 12 years and have found his honesty and integrity to be beyond reproach.

I'm sorry eloanpro had a bad experience but it appears as though The Mortgage Professor has been unfairly implicated in this complaint.

Chuck F
Newcastle, Washington

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