Posted by LindaP/OH on 4/28/07 11:01am
Msg #187691

Predatory lender

Moral question. I will try to keep this short and to the point. Closed a loan last night for an OBVIOUSLY predatory lender with its UNSCRUPULOUS appraiser. Terms of loan were totally immoral--even considering the borrowers were marginal. There is always more to the story with the bo, but it is so very difficult to see good, though totally unsophisticated people, being raped by these lenders time and time again. Having been a signing agent for twelve years, I have seen a lot but this is the first time I have ever felt the need to go back and talk to these people again, try to help them.. OK, I know I am just the notary, but at what point do we stop turning a blind eye. I know how to report to the sos--this would be the first time I have turned in one of these lenders. What do you all think???

Reply by Regal/NC on 4/28/07 11:22am
Msg #187696

Unless you have proof positive of what you suspect, I would suggest you MYOB.
It it was so bad, why did you take the assignment?
JMHO!

Reply by LindaP/OH on 4/28/07 3:08pm
Msg #187763

Regal-- to answer your question--wouldn't it be nice if the scheduling entities would share with us the details of the loan we are to close for them--most of the time there is very little information given at time of scheduling--its very difficult for me to tell which loans are going to be sub-prime and which are just fine. I rarely close sub-prime loans--it makes it difficult to stomach what some lenders offer. I will MYOB, I understand my obligations and I appreciate everybody's opinion. Thank you

Reply by Linda_H/FL on 4/28/07 3:59pm
Msg #187772

Linda - As a signing agent, the details of the loan are not your concern - period. Your concern with regard to the signing is to identify the borrower, execute docs and notarize.

If your conscience is such that you feel the lender has done something illegal, perhaps your state agency governing lenders (the banking commission, fraud division, mortgage fraud unit? as suggestions) can help you or can steer you in the right direction. I just suggest you go fully armed with airtight evidence of what you think took place, not just the "I think this is totally immoral". Under no circumstances should you go back to that borrower with your feelings.

If you feel that strongly about it, in the future you might want to consider screening your assignments to be sure you never close for this lender again...

Just a suggestion, and of course, JMHO

Reply by Tim_Mphs/TN on 4/28/07 1:05pm
Msg #187718

If you believe a law has been violated, I believe you have an obligation to report that to someone in authority. The tricky part comes in when you are acting as the subcontractor for the guilty party.

As a Notary Public, you took an oath to serve the public by being an impartial witness -- that can be hard when one side is taking advantage of the other side -- but we are not supposed to be an advocate for either side. There is also the question of what contract did you sign with your SS or TC client and what does it say about proprietary or confidential information.

You may want to discuss this with your attorney, both in terms of your obligations to your client and your obligations under the laws in your state.

== I am not an attorney and the foregoing is not intended to be legal advice or legal opinions. ==

Reply by Roger_OH on 4/28/07 1:48pm
Msg #187736

Not your business...

You were not involved in the factors that led to the deal, and it's not your function to question or comment on them to the borrowers. As a notary you're an impartial third party there on behalf of the state to ID the borrowers, witness/notarize signatures, and administer oaths.
To go off on your own tangent is to expose yourself to the risk of liability from the TC or lender. Do your job and leave; you're not the loan police for the borrowers; caveat emptor still applies.

Reply by JanetK_CA on 4/29/07 6:21pm
Msg #187925

I wholeheartedly agree...

I've had my share of situations where I left a signing feeling like I needed another shower (and not because of anything related to the borrowers or their home!) One in particular, a lender representative or broker was there ostensibly to resell the loan (I didn't know in advance) and said some things that I thought were dissembling at best. If I ever find myself in a situation like that again - and I probably will - I will remove myself from the room until they are ready to proceed. (I think the borrower ended up rescinding on that one - at least I hope so.) I was there to do a specific job and nothing more or less. I wasn't aware of any laws that were broken or any actual crime happening (although sometimes it feels like it...)

I think Roger explained it perfectly. Sometimes we just need to suck it up, do our job and move on. If we have a goal of preventing some of the ugliness we all know exists in our industry, we need to find another way of doing it.