I went to Lending Tree which led me to LSI mortgage when I heard that the interest rates were going down. When I was first contacted, I explained that I was only interested if they could lower my monthly mortgage payment or keep it the same and get more money to pay down a credit card. I then went through a lot of paperwork starting on 10/18/2011 so that they can do the analysis to see if I could benefit from getting another mortgage loan.
We went back and forth with many emails, a lot of paperwork and I had to pay $415 for an appraisal. On 11/30/11 I received my disclosure which I thought was incorrect because it was for a 15 yr mortgage at a much higher monthly mortgage payment, there would be no extra money from the loan. This was the justification for this loan and I quote from an email:
"the reason I sent you the 15 year is because with the low appraisal it makes a lot more since. The rate is better and the payment is $2038 and it cuts your term in half. Keep in mind this loan will allow you to skip your December and January payment and will also give you all of your escrow money back from your current lender. This should free up around $3100 on the payment deferral and another $4100 I escrows which would give you the $7200 you are looking for. The 30 year with mortgage insurance is not saving you much money. This loan reduces your balance by 80% of the payment each month which saves you $164k in interest over the life of the loan. "
This is an email quote from me on 11/25/11:
"After our conversation Im expecting to see a new quote for the 30 years to see if this is even worth while. I need you to breakdown your costs and what I would be getting back after I accepted the new mortgage. I would not have paid for the appraisal if I would have known I would not be getting back any money or lowering my monthly mortgage amount. Im hoping that you can lower my percentage rate enough for the refi to be worth going for."
This is an email quote from me on 11/28/11:
"Do you have new figures for me on my Refi? It cost me $415 for the appraisal to find out that my house lost value in 9 mos. So I was given figures for a 15 year mortgage but the whole reason for my refi was to get money to pay off my credit card and wind up with the same mortgage payment. Now I just need to lower my mortgage payment so I can afford to keep my payments to my credit card. Please give me your best rates so I can move ahead with the refi.
If it's just a small difference without any extra money it maybe more costly to get the refi, I'm not sure so I need all the figures. I waited so long to get this moving and now I need to make a decision or lose the money I put out for my appraisal fee. I Do not want to have to go through the full process again. I had several conversations with you stating that I knew I couldn't afford what you kept telling me I could but to get approved and you would try and do something at that point.
So I went ahead spent another $150 to get approved and kept stating that I couldn't pay the amount you came up with and hoping you would understand. Last night I came home to a new disclosure and starting reading through the amounts, I cannot sign the paperwork because I know I cannot afford it. So now I'm stuck going through any savings that I may have to pay my current mortgage late and be in more debt.
I have recommended you to some others because in the beginning you were stating you could help me and that this was the right direction to go in and that we would not pursue this direction unless you thought you could help me with my situation, but all I see is that you are not looking at my situation but just numbers and figures that are not in my real world. I make good money but had to borrow from my 401K to get my house and I have other deductions from my gross pay, I cannot add another $400 to my monthly mortgage payment.
I had to transfer money from my savings and will now have to cushion of any money going forward, so my experience with you trying to help me has just made me be late on my current mortgage, probably will hurt my credit rating and I will have no back up money in any account. I'm in worse condition now then I was prior to contacting your company.
After our conversation Im expecting to see a new quote for the 30 years to see if this is even worth while. I need you to breakdown your costs and what I would be getting back after I accepted the new mortgage. I would not have paid for the appraisal if I would have known I would not be getting back any money or lowering my monthly mortgage amount. Im hoping that you can lower my percentage rate enough for the refi to be worth going for."
We kept going back and forth and he convinced me that I would pay down my mortgage and would be able to use the escrow from the 1st loan to pay for the difference in my mortgage amount and in the 4 months my mortgage amount would be lower and if I could not keep up with the payments he would do a Refi for the 30 year. At this point I had gone through so much paperwork and time I had him put it in writing.
email quote 12/20/11:
"Can I do it by email.. I will streamline your fha refinance anytime after 120 days and you will not have any fees for redoing the loan.. you will get a pro-rated credit on your upfront premium which will wipe out your new premium as well. Hope this helps."
So I get the 15 year mortgage and pay the higher monthly payment and it brings down my total mortgage amount. So I start email contact in March.
Email quote on 3/27/12:
"12-29-2011 was your funding date so we have to wait 120 days before we are eligible. That puts us at 4-29-2012"
He starts looking into this on 4/10/12 email quote from me on 4/27/12:
"Im following your advice and need to do something different to lower my mortgage payment which was my initial reason to contact you last year. I went along with getting a monthly payment that was too high based on using my escrow money to keep up with the payments. Im almost out of that money and I did not gain much at all since I had a legal fee that I had to pay, so now Im stuck with a high monthly mortgage amount that eventually I will not be able to pay. So Im contacting you as you advised me to do and waiting for you to give me some other options. You stated I would not have to put out any more money but can change my current mortgage. "
email quote 5/26/12:
"I just signed all the paperwork and have 3 days to decide whether to go ahead with the new loan and I just wanted to remind you of the reason I went to LSI for a Refi and that was to lower my monthly amount and have money to pay off my credit card. Since working with you the below is my analysis, now in reviewing below you feel youve given me a good deal and accomplished what I originally went to you for then I hope you do not have to deal with these issues when you get older and have someone help you the way you helped me.
I would have never went into the first Refi if someone would have done their homework on my home value. I did not want to go into a 15 year loan but you convinced me that it was in my best interest and that I would pay down the loan amount and that I could Refi again in 4 months and most likely be able to get down to the original payment I was making due to a lower interest rate. I know you do not control appraisals or house market and I know your bank is not making any money off this loan and that you are going to reimburse me for my appraisal that I was told I would not have to purchase.
Just comparing the PMI from the 15 to the 30 is astounding. At this time because your bank is not charging anything I dont think I can go anywhere else and get a better deal but you really have me stuck in a hard place. When I started working with LSI I thought you were really going to help me with my endeavor but I think you just wanted a Refi sale and then knowing you would get another one in 4 months, so I hope this did something for you because all you have done for me is put me in more debt and in higher monthly payments.
I would have been happy to tell and refer others to your company but at this time I cannot truthfully say you helped me as a customer. Thanks for the time you put into this and please let me know when I can drop the PMI and Please reimburse me for my $415. I am a writer and I expect to write about how homeowners are being ripped off instead of helped by mortgage companies and the government loans, I can illustrate with figures below but will not put in any names, theres always a lesson to learn in life, thanks for helping me with this one.
House Loan Analysis
Mortgage Amt Appraisal Monthly Loan Pyment PMI TotMthPyment Interest
1.) 197740 245000 1016 0 1551 4.875 Wells Fargo-30yr
2.) 198515 220000 1456 40 2040 3.875 LSI - 15 yr
3.) 201973 216000 950 197 1701 3.875 LSI - 30 yr
1 - Original loan for my house
2- First loan with LSI which was originally supposed to be a 30 yr loan and saving me money - turned into a 15 year with promise to get me a 30 yr without a new appraisal or any charges
3 - Second loan with LSI - I keep asking for figures on the original concept that I would not need an appraisal and would get a 30 year loan if that would have saved the $197PMI I would have taken it.
Even when I sent emails to cancel the loans they would keep coming back telling me the strategy where I could save money. Even with the last option they are still trying to convince me that I have a better deal, imagine that. What happens is you wait so long and get so much paperwork and then it's incorrect and you have to send it back by the time you get to do the analysis yourself and decide it's not a good deal, sometimes after you signed an array of paperwork, they will delay you cancelling.
I wrote an email while I was at work asking for paperwork to sign because it was not available there and when I get home and look through my paperwork and find the papers to sign it was too late. The other trick is they always try to tell you, you will save 2 months of non-mortgage payments, it's not true you always need to save a month ahead, so it's only 1 month and you do not get the full numbers until after the appraisal and then everything goes so fast when they finally get the final numbers.
OF course now the justification is that PMI will only last 2-4 years but that's a long time and the money is not going towards anything worthwhile for the customer. Even when that's done I still will be paying almost the same amount that I started off with when I purchased the house. This has caused me much stress and aggrevation as you can probably understand when you read this report. I wish I was back with Wells Fargo, everything they told me was reality.