Thursday, April 19, 2012

The House Buying Nightmare Part 3

This is the third part of my story regarding how a simple mortgage transaction turned into a nightmare I'll never forget. You can read the first two installments here:

The House Buying Nightmare Part 1

The House Buying Nightmare Part 2

Meeting With the President

When I first received the updated GFE that reflected an extra 2k in closing costs, I completely flipped out. I called Linda, my realtor, and she gave me the cell phone number of the managing loan officer at the Wells Fargo Home Mortgage branch we were working with. 

I called Boss Man, explained what had happened and scheduled a meeting for the following day. I brought with me the first and second good faith estimate (Good faith – ha!) I told him about my conversation with Lucifer and how Lucifer had assured me that I would pay nothing out of pocket at the closing table and, lo and behold, here I sit with a paper saying I owe $2000 in closing costs. 

Boss Man examined the numbers, double checked things on his computer and eventually found a myriad of mistakes. For starters, Lucifer had reduced the seller's contribution by $1000. Why? Well, this is rich. In my state, if your credit score is below 640, the seller can only contribute a certain amount to closing. Even if the seller agrees to pay more, he/she can't legally do it. Ole' Lucifer put me into that loan program. 

My credit score is over 800. 

He made other errors as well. When Boss Man was finished, the total amount I owed hovered somewhere between $400 and $800. Given the sheer number of inaccuracies Boss Man discovered in my loan paperwork, I informed him that I no longer wanted to work with Lucifer. Nor did I want him working on my loan. Boss Man agreed and I left. 

The Revelation

The next day I was getting ready for bed. I'd spent the better part of the day seething, but I was actually feeling better. It hit me like a cinderblock thrown off a turnpike: 

He has an investor who wants that house.

During my first meeting with Lucifer he mentioned to me that he worked with an investor who purchases property in the same area I was purchasing my home in. He was perfectly pleasant until one incident occurred that should have stopped the loan cold – but it didn't. It was during this time frame that it dawned on me that Lucifer probably called his investor and told him about the house and had him poised to pick up the contract when my loan fell through. 

I know it sounds like a conspiracy theory, but its the only thing I could think of that made any sense. I ran it by Linda, expecting her to tell me I was being paranoid and thinking crazy, but she didn't. She got very quiet and agreed that, yes, that would make sense. 

Not good. 

Lucifer Keeps Going

After he'd been informed that he was not to contact me and that I would be doing business with another loan officer, Lucifer began calling me several times a day and emailing me at least once a day. He's never been the slightest bit communicative before. It was almost spiteful how hard he worked to talk to me about my loan. This was to show me that he hadn't been removed. 

I talked to Boss Man two more times, demanding that Lucifer be removed from my loan. Boss Man assured me both times that he would take care of it, but it never happened. In the process, Lucifer lost two more sets of my bank statements. 

Closing Looms

Finally, finally all the paperwork was in and underwriting cleared my loan to close. The closing was set for tomorrow and I was feeling good about all this mess being behind me. All I was waiting for was the formal statement noting the exact amount that I needed to bring with me to closing. Imagine my surprise when I got the statement and discovered that the closing costs had climbed another $1000 to $3k. Not the $0 that Lucifer originally assured me it would be and not the $400 to $800 that Boss Man later assured me it would be. Nope, closing costs rose to $3000.

The loan was completed on a Tuesday morning. We decided to schedule an early closing for the following Friday. The attorney has to have the paperwork in hand a minimum of 48 hours before closing. I wanted to hurry and close because my interest rate expires on Saturday and has already been extended once. 

Lucifer did not send off the paperwork package to the attorney until Wednesday evening. It sat in that office for two days. Because the attorney did not receive it until after hours on Wednesday, the earliest we could close would be Monday and my interest rate would expire in the interim. 

Here and Now

I've spent the day trying to track down Boss Man so that I can get him to sit down with me, look me in the eye and tell me what the hell is going on. I faxed all the paperwork over to the managing loan officer at a different bank. That loan officer looked over the paperwork and was appalled. She said that these kinds of mistakes are the sorts of things that inexperienced loan officers do, and that a lender as large as Wells Fargo should know better. 

Now I see how Wells Fargo got so big. 

The problems in the final settlement statement have to be fixed and delivered to the lawyer tomorrow for us to close on time. Because this has been our fifth extension, the seller has declined to give us another one. If it doesn't close on time, we lose this contract. If I'm right and Lucifer has someone waiting in the wings to pick up this house, he's going to do everything in his power to make sure this loan can't close on time. 

Either way, I'm calling the BBB. I've worked helping people fight shady and unethical collection agencies for more than a decade and I have never encountered a single collection agency that was worse than Wells Fargo has been to me. I have excellent credit, a stable income and should be the ideal mortgage candidate. Instead, I've spent four months trying to get a simple mortgage. 

This is insane. 


  1. What a nightmare! Thank you though for sharing your story...just say NO to WF & FM! Good luck with The BBB-they were useless when I had a complaint against Delta airlines.

  2. It's now a month later. Did you close on the home?
    We went through a similar situation with our builder 6 years ago. He got higher offers than what he contracted with us for. He then kept delaying finishing our home hoping our loan would expire. We're in the home, but the victory was a little tainted.

    1. Yeah, we finally closed but I ended up having to get an attorney. The threat of a lawsuit and making the whole nasty business VERY public made them change their tune. This was one of the most terrible experiences I've ever had and considering the business I'm in, that says a lot.

  3. That was really a nightmare and i can't imagine it.

  4. Have them send you the settlement offer IN WRITING. Open a new checking account at your bank. Put only the amount of money in the account that you need to make the payment each month and pay out of that account
    Collection Agency

  5. Lee - hope everything turned out OK with your house! What a nightmare.

    I've spent the past few hours digging through your blog - what a great collection of info!

    Quick question for you - i have a whole bunch of 2+yr old chargeoffs/collections accounts on my credit report (all credit card related - the great recession was a disaster for my finances). I finally have some money to start paying a few of you recommend that i wait until one of them sues me before i bother to pay and basically save my money until then? I'd like to have clean credit in ~5yrs when these all burn off - does it matter whether i pay them or not (other than being sued i mean). Is there any benefit to trying to work things out with the CA's before they hit the legal button? Lastly - if i have the option to settle or pay in full, is there a big benefit or difference one way or the other from a liability/credit rating standpoint? thanks a lot!

    1. Whether or not you pay is totally up to you. Keep in mind that paying these off does not improve your credit score one bit. At this point, whether to pay or not to pay is simply a moral dilemma. Keep in mind that paying resets the SoL for lawsuits.