The Mortgage Nightmare People!

[John S. Rabi]

In case you are in a need of financing, make sure you stay FAR FAR FAR FAR away from Island Home Capital! One of my clients is buying a house that was appraised at 10% more than the purchase price. (In this market the appraisers are very conservative, so you can bet this is a very good deal!) My client is putting 50%, yes, FIFTY PERCENT down and has a credit score of 800. We have been in escrow since December 8th and this joke mortgage company is unable to close the loan! We have received three different e-mails from them specifying the EXACT DATE of closing but the days just go by without even receiving a notice from them. In addition, they padded the original estimated closing statement so bad that if I were the client I would go after them big time! I don't often post about companies that I had bad experience with, but Island Home Capital is a joke, a totally unprofessional company.

Aloha,
John S. Rabi, GM,ARB,BFT,CM,CBR,FHS,PB,RB
808.989.1314
http://www.JohnRabi.com
Typically Tropical Properties
"The Next Level of Service!"

[EightFingers]

Is you client stuck with this company? Can't they go with someone else? With financials like your client has, seems like it would be fairly easy to get a mortgage. I've never gotten a mortgage, so maybe I'm not understanding the situation.

[Hotzcatz]

I'm not sure who my friends are using but they've had three different closing dates. Each time they go in to sign the papers they find some sort of detail snuck in there that they didn't want. There wasn't supposed to be a pre-payment penalty, the paper writers SAID there wasn't a pre-payment penalty yet when my friends went to sign and read the document, there is was - in writing - a prepayment penalty. Then next was a requirement for mortgage insurance for the entire life of the loan, not just until enough equity was in it and then there was one more small detail that would have made the mortgage company a hundred thousand dollars over the life of the loan although I forget specifically what it was. When you get a mortgage READ THE DOCUMENTS do not let them "tell" you what is in them.

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"I like yard sales," he said. "All true survivalists like yard sales."
Kurt Wilson

[Fishboy]

Hotcatz,
Jeez, that sounds like a financial ambush by the mortgage company. How does the average person defend against that kind of thing? I mean, the signing process involves a small mountain of documents that are mostly standard formats and boiler plate. It's been a few years since I went through that process, so I don't recall if things like the mortgage insurance issue was in a special place where the stipulation that it be paid over the course of the entire loan lifespan would have been reasonably recognizable. Would you recommend taking a lawyer to signing?

Aloha pumehana,
Brian and Mary
Lynnwood, WA\Discovery Harbour

[Dennis]

I have been in the mortgage business for nearly 35 years in Ohio. My recommendation, always deal with a reputable bank or Savings & Loan. Mortgage Brokers must sell their loans to various investors. These same investor appetites come and go. In my opinion, this particular mortgage broker cannot find an investor to take his clients loan even though it sounds like A+ paper. The S&L I work for has gotten involved in the middle of deals many times, and while there is a lot of pressure to close on time, someone needs to explain to the seller the problem and that while everything will be done to expedite the deal, it may be delayed. I would hope that in this market, the seller would understand that it may be better (Financially) to wait another week than lose the deal and go back on the market for who knows how long.

[EightFingers]

"... How does the average person defend against that kind of thing? ..."

Hire a lawyer. I had the help of a lawyer during our land purchase and she was very helpful.