Complaint Review: firstar bank

i believe you are misunderstanding what has happened. firtar is using our second morgage loan note as 'points' gimmick. we sued the first morgage holder to get them to pay us for the note but when they tried to refinance their loan they were refused for no reason. we both put out a lot of money for 'lawyers' to fight each other when we should have been fighting firstar bank. i don't beleive any of us knew who the culprite really was.

Marvin, I am sorry to hear about your financial strife with this loan. You might want to look into refinancing at a lower interest rate, if that is an option for you.

I just had to make comment to your statements though. My remarks that follow are not only for you but for anyone else contemplating a new mortgage loan but aren't sure they understand the process.

You trusted the broker, the lender AND the title agent to protect you and your interests.

The Broker is the one that should be held mainly responsible for this transaction. The lender, although not completely innocent, simply provided the funds for the loan and placed a lien on your property in return (the mortgage) as collateral. The title agent simply provides the lender with title policy for that mortgage (to protect the lender's interests) and, often times, will also perform the presentation of the loan documents to the borrower (you) at the closing as a service to the lender.

The title agent has absolutely no control over nor any say at all in what the terms of your loan are. They are also not permitted to give you financial advice - they are not licensed to do that. The title agent must strictly adhere to any and all of the lender's and broker's closing instructions - period! They have absolutely nothing to contribute regarding the terms of your loan as dictated by the lender and are forbidden under their own company rules and regulations to provide you with any advice regarding the specific terms of your loan in which they are closing.

Your broker, on the other hand, was paid, by you, to provide a service: to find you a lender and initiate your loan application with that lender. A lot of brokers work almost exclusively with a particular lender, therefore they do not "shop around" for the best interest rate for you. Other brokers (the ones worth their salt) will try to look out for your best interest and find a lender with a decent interest rate to fit your specific credit rating (most lenders issue interest rates based on your credit score). On this note, a mortgage broker is really only necessary if a potential borrower has a poor credit rating. If one has decent credit, I highly recommend avoiding the use of a broker - you will save thousands at the closing table!

You are provided with a "Good Faith Estimate" statement BEFORE the closing - it is a VERY GOOD IDEA to look this over THOROUGHLY as soon as you get it to make sure that you agree to the terms of your loan. You WILL see SOME estimates on it based on the income/expenses information you provided at the time of your loan application, these are only estimates and nothing to get excited about (unless they are totally obnoxious and NOTHING near what you provided on your application). HOWEVER, the ACTUAL interest rate of your loan should be disclosed to you on the Good Faith Estimate! If it isn't, ask what it is and GET IT IN WRITING! If it not the interest rate that you agreed to or wish to agree to, stop the loan process and try to re-negotiate it! If it can't be re-negotiated, find another broker/lender who will offer you an interest rate you CAN live with!

If you by-pass this step by not thoroughly examining the GFE (or get the interest rate in writing) prior to close and you get to the closing table, you will be presented the "NOTE" to sign. The NOTE will disclose to you the ACTUAL interest rate and other specific terms of your loan! If you have a fixed-rate note, the most important part of that NOTE is the interest rate! It will be the ONLY interest rate you will pay throughout the life of the loan. If you have a variable rate (adjustable rate or ARM) NOTE, be sure you agree to the terms of the adjustments: the rate and the frequency. If you have a balloon note, be sure you agree to the terms of the balloon payment at the end of the repayment period of the NOTE. If you do not agree to the terms of the NOTE, stop the closing and sign nothing else. Try to re-negotiate the interest rate with the lender or find another lender who will offer you an interest rate you CAN live (you can't do this in the closing room though).

If you sign the note anyway but are uncomfortable with the terms of the new loan after you return home from the closing AND are afforded a 3 day right-of-recission, USE it! Do NOT wait until midnight of the 3rd day to decide that this is not what you want because THEN it will be too late! NOTE: a 3 day right of recission is NOT afforded in a PURCHASE closing. If you are buying a home with a mortgage loan, there IS NO 3 DAY RIGHT OF RECISSION! On MANY construction loans, a 3 day right of recission is also not afforded (especially for new construction since the loan is NOT on your primary residence!). A 3 day right of recission is also NOT afforded for your loan on property where you do not reside as your primary residence (ie: your vacant lot next door or rental property).

If you really want to be certain you are getting what you want from a lender/broker, spend the extra bit of money to have the loan documents reviewed by an attorney. S/He doesn't have to be present at the closing but you can request that an "attorney's package" be provided to the attorney of your choice a day or two prior to close. This is a nominal fee considering what you COULD be paying if you sign the documents without the attorney's review! I highly recommend a REAL ESTATE attorney for this type of situation!

I hope my information has shed a little light on the lending process. For those whom have already entered into a loan transaction with less than desireable terms, please find a way to refinance. Again, avoid a mortgage broker unless you have questionable credit. Brokers CAN be usefull, but only if they are necessary!

VERY, VERY, VERY IMPORTANT: Shop around for a reputable broker/lender LOCALLY
My best wishes to you Marvin.