I recently refinanced my home. I used the mortgage company that arranged the original loan on my home. They did a good job the first time, and everything happened pretty much as the company stated, so I felt confident they would handle things equally well this time around. I was told by the loan arranger, Rick Fankhouser, that I would receive an FHA refund of about 1,674.00 within 30 days of refinancing. The following scenario was described to me: after the transaction I would skip a month of mortgage payment and my out of pocket costs following the transaction would be as follows: closing payment 3,611.01, less one month skipped mortgage payment of 1052.50, less refund of 1674.00 = out of pocket costs following transaction of 884.51.
Well, after the thirty days had passed I called Rick Fankhouser and he said they would "try to get a check out to you in a few weeks." The check never came. It turns out I was apparently deceived or just plain lied to regarding the manner in which I would receive the refund. Looking at the mortgage papers, they "refunded" the amount to me in the refinance transaction by applying the supposed refund amount against the costs of the transaction. Thus, I received NONE of the amount I was told would be refunded to me after the transaction as stated, and the costs of the transaction were thus understated. So, technically, I got the refund amount, but most certainly not in the way it was stated to me above. Additionally, the company claimed I would receive a refund of escrow funds of approximately 631.00, but that amount was actually only 46.48.
This has put me in a terrible financial bind. When I got nowhere calling the company, I complained to the BBB, and the president of the mortgage company, Robert Capps, condoned this business practice. The BBB at least logged the complaint on my behalf, but it did not really go far enough.
This was my first time refinancing, and I am older and wiser now. I will never see that money again, but I am not taking it lying down. I have become an activist. If I could give advice to would-be homeowners or those who want to refinance, it would be the following:
First, get it in writing. Ask about refunds, and get in writing exactly how much they will be, what the source of the refunds is, who will be sending them, and when and how you will receive them. You could possibly create the document yourself and have the mortgage company sign and notarize it.
Second, don't trust anyone. Even if you have done business with them before. Make absolutely certain you know exactly what will take place; from start to finish and everything in between.
Third, if possible, have everything the company tells you regarding the transaction written down, and take it along with all mortgage documentation to a real estate attorney and have him compare what the company tells you to what the documentation actually says. If there is a difference, find out why. Under the worst case scenario, report the company to all the consumer advocacy groups you can, along with your state attorney general.
Finally, everyone, whether you have been ripped off or not, lobby your elected representatives, especially those on the state and federal levels for reform and tougher enforcement of finance laws. Contact your state attorney general as well. I am and will continue to lobby my representatives as well. No one deserves to be taken advantage of in this manner, and it should not be tolerated. Most people do not expect to be deceived by a mortgage company.
BBB A WASTE OF TIME
The BBB had no file on them at all before I filed. The explanation on the BBB website when you pull them up is something along these lines: "Our file experience is limited on the company since it is new to the BBB files." Now tell me, what the heck is that supposed to mean? What does that tell anyone? See for yourself at http://www.kansascity.bbb.org/search.html
MY LETTER TO: Mid America Mortgage Services
Mr. Robert Capps
c/o Mid America Mortgage Services
851 NW 45th Street, Suite 200
Kansas City, MO 64116
Re: Response to previous letter 10/12/01
Dear Mr. Capps,
I apologize for the tone of my last letter. Lack of sleep tends to fray a body. I offer no apologies, however, for my more than justified anger and frustration at this situation and the position it has put me in.
This is my last letter on this subject. Since it seems you are having a difficult time understanding a few issues, I am going to make them as clear as possible here.
First, I have every right to expect goods as promised. I was told clearly and distinctly I was to receive refunds in the range of $1,600.00 within thirty days of closing. The refunds never came. So, just what happened to these refunds? Did they ever exist? If you will reference the enclosed email, you will see that the $614.00 escrow refund is actually only $46.48, quite a difference to say the very least. Additionally, if the closing costs actually were $1,000.00 more than expected as you claimed, (which, by the way, is outrageously excessive) since that would therefore eliminate a large part of the refund I was promised, it should have been clearly disclosed ahead of the closing date, which leads me to my second point.
Second, if something changed and the above refunds were no longer in the works, I had every right to be informed and should have been before closing, not months after the fact. Your agents already had the closing numbers in place, and were certainly in a position to know and had to have known about ANY changes and should have informed me of them. I had a right to this information, yet your agents elected not to make it known to me. What happened in this case can be only one of two scenarios: either a) something changed before closing and I was not informed, or b) I was outright lied to regarding said refunds. Neither is acceptable or excusable.
Third, I have every right to complain when said goods do not materialize. A difference of a couple hundred dollars is one thing; a difference of almost $1,600.00 is an entirely different matter.
In sum, I get virtually none of the refund I was promised prior to closing, have vital information withheld or hidden from me, am put in a terrible financial position because of it, and you have the nerve to say that my complaint has no basis and DEMAND it be retracted? If I may speak freely, who in the world do you think you are demanding anything of me and accusing me of making you miserable? If you and your company had simply kept its word, none of this would have happened. You brought this all upon yourself. No reasonable person would tolerate such misinformation, nor will I.
Finally, I will retract the complaint if and only if I receive restitution, which is only fair considering the above circumstances. The complaint will not be retracted under any other conditions. No restitution, no retraction. Period. End of discussion. The choice is yours.
Unless you decide to make restitution, do not contact me again. I have had more than enough of your rationalizing an obviously raw deal. I wish I could retract my decision to do business with you.
Glenn K. Brody