Turned down based on appraisal picture

[84house]

Applied for and pre-approved on internet for a refianance loan. They charged $350 for appraisal and $35 for processing, proclaiming a refund once loan goes through. For appraisal, pictures were to be taken inside the house. I told them the house was a mess, extra being taken out to finish remodeling a 60 year old house with the original fixtures, outlets, etc. They said the appraisal was a formality. Appraisal came in $100,000 over refinance amount. Refinance amount was less than 80% of appraisal value.

Loan was declined because house was extremely cluttered and needed updating. Will not refund $350 or $35, won't even return phone calls, even though their messages say all calls will be returned in 24 hours.

Is this legal in California?

 

[Proserpina]

When you agreed to use this company, did you read the fine print?

I'm thinking that their TOS may just cover this exact situation...

 

[jharris352]

It's legal in CA or anywhere else. I suspect that there are other reasons you were turned down. I ran a mortgage company for 15 years, that doesn't sound right to me. I'm sure you are telling the story you have been told but there is something in the back room that isn't being told.

"Pre-approval" is a crock of bull pellets. It simply means that you meet the thresh hold standards. I think saying pre-approved should be outlawed. It is taken far more seriously by customers than it should be. Brokers know this and play on it.

"Refunding" your appraisal and credit report when it closes is just weak selling. They are just taking some money that you are paying them (Origination, Yield Spread, and fees) and "refunding" your appraisal and credit. In essence you are just paying yourself back. Brokers should have the integrity and the backbone to tell you that you are applying for a loan and an appraisal and credit check are unavoidable costs that the borrower pays.

People may not like to hear that, maybe they prefer to be lied to by the shell game of I'll "pay you back" after the closing, but I prefer to think people would rather just hear the straight scoop. Whatever happened to you, you really have no recourse. I'm sorry, but that is how it is.

 

[84house]

Turned down based on appraisal

Before I paid the fee, I expressly told him the house was not in selling condition, would this affect the decision on the loan? His response was no, as long as the appraisal was more than 80% of the loan value. I told him the condition of the bathrooms, the state of the flooring walls, etc., again this is not taken into consideration. Fine print versus asking him specific questions, you're saying that he does not have to forthcoming about my chances of obtaining the loan?

 

[army judge]

You were lied to because that is how these crooks make a couple of bucks.




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