Here's the post I put up a few days ago and at the end is the follow up thus far---seems the notary thing was worse than I orginally suspected. This is also on a large lending board.
Well I am back in the business of writing loans--opened my own shop-----and I seem to get the weirdiest calls from some those in the lending business or those who where referred to me by someone in the lending business. Here is a post I wrote on a lending forum and pay attn to the notary part. Someone from Michigan has some real big problems. I bet this outfit (both the notary and the broker) is going to wish that this call was received by anyone else but me. Calls like this get my skin boiling and when I know someone in the lending business committed fraud I direct customers straight to the state. I make sure they have the phone numbers, fax numbers, emails and who to ask for. So the person who falsely represents himself as a notary and even has the cajones to hand borrowers a business card when he goes to a closing, I want you to know who turned you in when you are still, after getting caught with your partners in thieves, lying to this lady. And too the LO who has no respect for state licensing and federal lending laws--no respect for hard working homeowners--It was me who told her to call OFIS, it was me who brought you down to your knees. Yes that's right, she called me for help and I thought it was so outrageous what you did, that I broke the silence people so frequently here from others in the lending business that is usually given after a loan closes and there is problems. I didn't tell her to call you and you would "work it out", I told her to call OFIS. It was me and I blew the lid off.
Also if some of you legal eagles have input on wheter she may still have a RTC---- I do know the federal 3 day RTC extends out to three yeas in some cases (i.e.---no RTC given, bad APR, TILA violation--etc) Anyone know about this?
I am put in contact with this customer (a friend of a friend of a friend who says, "Call Michelle--she knows about mortgages--maybe she can help you” I HAD NO PART IN THIS TRANSACTION AT ALL---customer calls me after the fact and here's her story.
The customer signs a refinance on her principal residence either on 04/27/05. The loan is done by and all correspondence website, email, everything) to the borrower is from "ABC Mortgage"---however the "Borrower Estimated Closing Statement" shows the loan funding through "XYZ Mortgage". It is a brokered loan to a widely used wholesale company. There is no HUD.
There are multiple issues here.
1. The loan as of 05/10/2005 has funded (it is believed to be funded by the borrower---it is really hard to know if it is funded for sure) but has not disbursed.
2. Borrower states there is a lien (mortgage type) on title that was paid in 12/04 but has not been released. She was very recently informed of this. It is present on the prelim title reports but it is believed the wholesale funding and underwriting department was not aware of it and a clear to close was issued. The title company now obviously wants to see a release to fund the loan and guarantee first lien position to the wholesaler. "ABC Mortgage" and the wholesale rep tell the borrower, "We are working on it"
2. The closing was done on 04/27/2005 by a mobile closer. The "notary" gives the a business card (with no title under the name to the borrower) with the name "Jim Smith" on it. The borrower later calls the number on the card and "Jim Smith" claims he has never been to the borrowers home, even asks the borrower to physically ID him on the phone. He states his wife makes rubber stamps and asks her if she wants to buy a stamp. She is totally perplexed by the call. A notary search is done on the state website and interestingly enough "Jim Smith's" wife is a notary. "Jim Smith" is not a notary.
3. Another notary (actually a notary) visits the borrower a week later with a quit claim deed. Deed is claiming borrower's former married name off house and her ex. Deed vests home in her maiden name which she now uses. She is also asked to sign a paper which nullifies her 3 day cancellation. A “Borrower Estimated Closing Statement" is also produced -- it shows an obvious "short to close" but does show $$ back to the borrower. The closing costs to "ABC Mortgage---although they are shown to be paid to "XYZ Mortgage" are roughly 7900.00. The loan amount is 123600. The application fee is 845.00. There is no yield disclosed on this document. She signs this. At this point as far as I know and I am fairly certain there still is no HUD.
A call is placed to "XYZ Mortgage" corporate office and XYZ claims all transactions/business must be done in the name of XYZ. ABC operates a website--mentions nothing at all that places any relation with XYZ and sends all correspondence in the name of ABC--nowhere on the website of ABC is any reference at all to licensing. ABC is not a licensed lender in the state but XYZ is---XYZ's license states they do business exclusively as XYZ. (This is per the state)
A call is placed to ABC who swears they operate as XYZ although even the phone is answered as ABC.
The borrower is a mess at this point. She states everyday it is something new. ABC told her "the money is going today" Title told her earlier today they have no routing number (for the wire) and asked her to find it as she had been given it on a previous conversation and had wrote it down.
I advised borrower to call regulatory office of our state and also the regulatory office for the notary's of our state. She did conatct OFIS--state regulator's and guess what, boy are they interested. They immediately labeled her as a victim of fraud. Both on the lender's side--big licensing problem and the notary's side. Did you know that was criminal? It is and OFIS is not looking at any in the transaction as "innocent bystanders" A payment is due for this note on 06/01 and the April and May payment is due for the note she refinanced out of due to broker telling her not to pay April and May as new loan was to fund---payoof was to be wired so it was believed a 30 day late would be prevented. Too close----will never happen with a loan closing on 04/27/2005---sure it coould fund by the end of the month but the wire would never be in the old lender's hands.
ABC now emails to the borrower that she is nuts (crazy may have been used---can't remember exact word. Tells her to "get a grip"
Unbelieveable. How can people have such greed and malice when they are dealing with someone's home? How, how, how? Wait until the wholesaler finds it--it will be tough on who is going to buy back this paper.
Looks like the husband/wife team who thought they would maximize signings at the end of the month never thought about what would happen when they falsely represented themselves and unknowingly signed dirty dirty paper. They thought it would close, get funded and noone be the wiser. If the right spouse would have gone they would have been innocent bystanders but now they are guilty of a felony per OFIS.
Also I know what SS hired the "dream team" They are a good SS and I know they played no part in this but I am sure will get dragged in. Would you give them a heads up?
End of orginal post
Well turns out the gal I thought was "Jim Smith's" wife has the same last name (common sort) and is no relation or cannot be shown at all to know "Jim Smith" thus far. It is mch worse. The husband and wife make notary stamps for a living and made some for themselves illegally. They have been at work for awhile and noone has caught it. Recorders record the deeds sent in and there is no check, of course, to see if the deed is indeed (no pun intended) notarized by a true notary. Well this loan has now been revealed to have 7 Federal Lending Violations (RESPA and TILA). Because after conferring with this borrower, I directed her to the state after she told me her story criminal charges on both the "false" notary and the unlicensed LO are down the road.
Notaries although you are in the business, please heed my advice:
Please, please, please---always have someone look who knows the loan business take a look at the loan someone else is presenting you.
Show your GFE to another LO from a different company. Don't just show the GFE--share your situation, what your LTV is, what income doc program you are looking at----find out if you really have to go "stated"---SEE YOUR MORTGAGE CREDIT REPORT WITH THE SCORES (mortgage credit reports frequently will be scored differently by the bureaus as compared to the scores you may get when you are doing a "soft" pull" of your own)-------IF THEY WOULDN"T LET YOU SEE IT, FIND AND DEAL WITH SOMEONE WHO WILL------ONE OF THE OLDEST TRICKS IN THE BOOK OF HACKS IS TO LIE ABOUT A BORROWER'S CREDIT SCORE MAKING THE BORROWER THINK THEY ARE WORSE OFF THEN THEY ARE---Bad LO's get more spread that way and if it is going to a "warehouse" or a "correspondent" they DO NOT have to disclose the spread on the HUD. If you don't know what spread is, then you of all people need to show someone what you have been presented with
A good decent LO will only "poach" a bad loan away from another LO thus by thier "poaching", they are saving you from a nightmare. If you are getting a good deal, a good decent LO will not "poach" a loan from another good decent LO who is offering you the loan.
If the loan is way off the GFE--don't sign
If you don't get a GFE---don't sign
Look at the Truth In Lending---compare apples to apples or APR to APR
And never stop making payments, regardless of who says what--that is another old trick, get the borrower desperate and they will sign anything---never, never, never---only stop making payments after funding--not after closing (unless it is a wet close) but after funding