Cheryl
Danbury,#2Consumer Suggestion
Mon, March 13, 2006
I'm sorry that this happened to you as well. The truth is that many lenders have prepayment penalties longer than the fixed term on a Adjustable rate mortgage. Yes, several companies you call will not have heard of that or say that it doesn't exist...but in reality, the bigger the company, the more they can get away with. The purpose of a 3 yr prepay on a 2 year fixed ARM is so they may recoup some of the money lost on people not going to refinance with that company. Just be lucky that you don't have a 5 year prepay with a three year loan. Ameriquest does it as well as several other large companies. The higher risk clients primarily get these programs as a way of locking the consumer in...so to speak. It is not illegal to do what they are doing, just unethical.
Cheryl
Danbury,#3Consumer Suggestion
Mon, March 13, 2006
I'm sorry that this happened to you as well. The truth is that many lenders have prepayment penalties longer than the fixed term on a Adjustable rate mortgage. Yes, several companies you call will not have heard of that or say that it doesn't exist...but in reality, the bigger the company, the more they can get away with. The purpose of a 3 yr prepay on a 2 year fixed ARM is so they may recoup some of the money lost on people not going to refinance with that company. Just be lucky that you don't have a 5 year prepay with a three year loan. Ameriquest does it as well as several other large companies. The higher risk clients primarily get these programs as a way of locking the consumer in...so to speak. It is not illegal to do what they are doing, just unethical.
Cheryl
Danbury,#4Consumer Suggestion
Mon, March 13, 2006
I'm sorry that this happened to you as well. The truth is that many lenders have prepayment penalties longer than the fixed term on a Adjustable rate mortgage. Yes, several companies you call will not have heard of that or say that it doesn't exist...but in reality, the bigger the company, the more they can get away with. The purpose of a 3 yr prepay on a 2 year fixed ARM is so they may recoup some of the money lost on people not going to refinance with that company. Just be lucky that you don't have a 5 year prepay with a three year loan. Ameriquest does it as well as several other large companies. The higher risk clients primarily get these programs as a way of locking the consumer in...so to speak. It is not illegal to do what they are doing, just unethical.
Cheryl
Danbury,#5Consumer Suggestion
Mon, March 13, 2006
I'm sorry that this happened to you as well. The truth is that many lenders have prepayment penalties longer than the fixed term on a Adjustable rate mortgage. Yes, several companies you call will not have heard of that or say that it doesn't exist...but in reality, the bigger the company, the more they can get away with. The purpose of a 3 yr prepay on a 2 year fixed ARM is so they may recoup some of the money lost on people not going to refinance with that company. Just be lucky that you don't have a 5 year prepay with a three year loan. Ameriquest does it as well as several other large companies. The higher risk clients primarily get these programs as a way of locking the consumer in...so to speak. It is not illegal to do what they are doing, just unethical.