- Report: #901058
Complaint Review: Greenlight Financial - Internet
Reported By:
Dave -
Cathedral City, California, United States of America
Submitted:
Updated:
-
Author Not Confirmed
Why?
Greenlight Financial
Internet, United States of America
Phone:
877 773-2783
Web:
www.greenlightloans.com
Categories:
Business Rating:
(0)
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Greenlight Financial Bait and Switch mortgage rate Internet
BAIT AND SWITCH
After spending $350 on an appraisal, plus all the time it takes to deal with all the paperwork, Greenlight gambled that I was far enough into the loan that they could jack their rate up from 3.375% to 3.5% and that wouldn't be a big enough difference for me to walk away. Here is the bare-bones summary of what happened:
BAIT:
ME: April 2012, to All Lenders: "I would like an 80% loan to value cash-out refi on a home with estimated value of $225k and existing loans of $140k. "
Greenlight: We can do that for 3.375% with no cost to you other than a $350 appraisal fee.
Me: Let's do it
Greenlight Loan Documents: home value $289k, loan $194k
Me (email): your loan docs don't seem right, this is a 67% Loan to Value (LTV). If the appraisal is lower, do we have to redo the documents? If it really appraises that high, I would want a higher loan amount.
Greenlight (email): That's ok, just sign these. We can amend the documents when we get the appraisal.
Appraisal: $218k
New Loan: $170k @80% loan to value, just what I asked for originally.
SWITCH
Greenlight: Golly, the appraisal was low. We need to increase your rate to 3.5% because the LTV is 80%
ME April 30 (direct quote from email): "I told you I was interested in an 80% LTV and taking out the rest in cash when you quoted the $350 closing fee. I am interested in taking out the $30 k and having you honor your no closing fee commitment. "
Greenlight (email): May 1. Let me check with my manager.
Greenlight: May 8 (direct quote from email) "Good News!! The loan was formally approved..."
Greenlight: June 1. All we need now is your approval of the 3.5% rate.
ME: wait a minute. what did "Good News!! The loan was formally approved.." mean? Also, this is almost identical to the loan I originally shopped to all the lenders. I chose you because you said you could do it for 3.375% and no closing costs.
Greenlight: the appraisal came in under what we estimated
Me: the appraisal is irrelevant. I asked for 80% loan to value. Simply multiply the appraisal by 80%, and that's the loan you told me you could do for 3.375%
Greenlight. The 3.5% loan will only cost you $10 more per month.
Me: it is now June and we should be closing this loan. I asked every lender in April to give me their rate on a $225k home cash out 80% loan to value so I could compare Apples to Apples. You had the best rate. Changing the rate 2 months later sure smells like a bait and switch. Also, in May you said "Good News!! The loan was formally approved.." At what point do we have a deal that I can count on not changing with your next email?
Greenlight: I'll see what I can do.
<no reply for a week>
Me: it has been another week
Greenlight: your rate lock has expired. Now you can pay the 3.5% plus another $190 in fees. Its a great deal.
POST SCRIPT: I sent them a draft of the above and offered to print their rebuttal, but they did not reply. I have seen other complaints online about this company, and they posted a response to almost all of them, aggressively defending their reputation. I expect them to counter with one or more of the following:
-They tend to say their investigation reveals that the person posting is not a legitimate customer but is a plant by a competitor. Well, I am a legitimate customer and am willing to give contact information if I have to prove it.
-They are also likely to say something about how I signed the paperwork for the 67% LTV loan and it is only obvious that the rate would change if the LTV went to 80%. My reply to that is that I signed under false pretenses based on my email questioning the paperwork and their reply. I told them verbally at the beginning I was looking for 80% LTV, and I sent them an email before signing telling them I wanted a higher LTV than what was in the preliminary loan docs. They had an opportunity and an obligation at that time to tell me that raising the LTV from 67% would result in a higher interest rate since the rate, points, and fees are the heart and soul of the loan. As a result, I had every reason to believe that the rate quoted was good from 67% up to 80% LTV.
-They may apologize for the misunderstanding. A competent loan company that has been in business this long knows, or should know, exactly what they are doing. The emails clearly show I wanted a higher LTV, and that they implied that it was no big deal to adjust the loan values on the documents once the appraisal came in. Either they deliberately failed to tell me the that the higher LTV I wanted would cost more, which would be fraud, or they truly didn't think it was important, in which case they are incompetent. Either way, I feel obligated to warn others about this company.
After spending $350 on an appraisal, plus all the time it takes to deal with all the paperwork, Greenlight gambled that I was far enough into the loan that they could jack their rate up from 3.375% to 3.5% and that wouldn't be a big enough difference for me to walk away. Here is the bare-bones summary of what happened:
BAIT:
ME: April 2012, to All Lenders: "I would like an 80% loan to value cash-out refi on a home with estimated value of $225k and existing loans of $140k. "
Greenlight: We can do that for 3.375% with no cost to you other than a $350 appraisal fee.
Me: Let's do it
Greenlight Loan Documents: home value $289k, loan $194k
Me (email): your loan docs don't seem right, this is a 67% Loan to Value (LTV). If the appraisal is lower, do we have to redo the documents? If it really appraises that high, I would want a higher loan amount.
Greenlight (email): That's ok, just sign these. We can amend the documents when we get the appraisal.
Appraisal: $218k
New Loan: $170k @80% loan to value, just what I asked for originally.
SWITCH
Greenlight: Golly, the appraisal was low. We need to increase your rate to 3.5% because the LTV is 80%
ME April 30 (direct quote from email): "I told you I was interested in an 80% LTV and taking out the rest in cash when you quoted the $350 closing fee. I am interested in taking out the $30 k and having you honor your no closing fee commitment. "
Greenlight (email): May 1. Let me check with my manager.
Greenlight: May 8 (direct quote from email) "Good News!! The loan was formally approved..."
Greenlight: June 1. All we need now is your approval of the 3.5% rate.
ME: wait a minute. what did "Good News!! The loan was formally approved.." mean? Also, this is almost identical to the loan I originally shopped to all the lenders. I chose you because you said you could do it for 3.375% and no closing costs.
Greenlight: the appraisal came in under what we estimated
Me: the appraisal is irrelevant. I asked for 80% loan to value. Simply multiply the appraisal by 80%, and that's the loan you told me you could do for 3.375%
Greenlight. The 3.5% loan will only cost you $10 more per month.
Me: it is now June and we should be closing this loan. I asked every lender in April to give me their rate on a $225k home cash out 80% loan to value so I could compare Apples to Apples. You had the best rate. Changing the rate 2 months later sure smells like a bait and switch. Also, in May you said "Good News!! The loan was formally approved.." At what point do we have a deal that I can count on not changing with your next email?
Greenlight: I'll see what I can do.
<no reply for a week>
Me: it has been another week
Greenlight: your rate lock has expired. Now you can pay the 3.5% plus another $190 in fees. Its a great deal.
POST SCRIPT: I sent them a draft of the above and offered to print their rebuttal, but they did not reply. I have seen other complaints online about this company, and they posted a response to almost all of them, aggressively defending their reputation. I expect them to counter with one or more of the following:
-They tend to say their investigation reveals that the person posting is not a legitimate customer but is a plant by a competitor. Well, I am a legitimate customer and am willing to give contact information if I have to prove it.
-They are also likely to say something about how I signed the paperwork for the 67% LTV loan and it is only obvious that the rate would change if the LTV went to 80%. My reply to that is that I signed under false pretenses based on my email questioning the paperwork and their reply. I told them verbally at the beginning I was looking for 80% LTV, and I sent them an email before signing telling them I wanted a higher LTV than what was in the preliminary loan docs. They had an opportunity and an obligation at that time to tell me that raising the LTV from 67% would result in a higher interest rate since the rate, points, and fees are the heart and soul of the loan. As a result, I had every reason to believe that the rate quoted was good from 67% up to 80% LTV.
-They may apologize for the misunderstanding. A competent loan company that has been in business this long knows, or should know, exactly what they are doing. The emails clearly show I wanted a higher LTV, and that they implied that it was no big deal to adjust the loan values on the documents once the appraisal came in. Either they deliberately failed to tell me the that the higher LTV I wanted would cost more, which would be fraud, or they truly didn't think it was important, in which case they are incompetent. Either way, I feel obligated to warn others about this company.
2 Updates & Rebuttals
Dave
United States of AmericaGreenlight Came Through
#2Author of original report
Fri, August 24, 2012
I posted the original report and have some good news regarding this company.
I am pleased to confirm that Greenlight has made good on their promise and I signed loan documents with them. While I was shopping for a new lender, they called me, apologized, and asked if they could have another try with the loan. The new loan consultant and closing coordinator expertly and rapidly secured a hassle-free loan for me at somewhat better terms than originally offered. It is all I could have hoped for in a lender. It turns out they do take customer satisfaction seriously. I would use them again.
sorry for the late retraction. I tried to post this the day we signed the documents, but for some reason it never appeared on the web site, so I am trying again.
GFS Consumer Affairs
Irvine,California,
United States of America
We are pleased to learn of your continued interest in refinancing your mortgage with Greenlight
#3UPDATE Employee
Mon, July 09, 2012
Following a careful review of your loan file, our Director of Consumer Affairs contacted you by telephone on June 26, 2012 in order to resolve the issues raised in your complaint. During that conversation, we were pleased to learn of your continued interest in refinancing your mortgage with Greenlight, and we were able to offer you a new rate lock at the current market pricing which is lower than the original quoted rate. The Company will pay all third party settlement fees with the exception of a re-inspection fee that is required due to the condition of the swimming pool at the time of the original appraisal. This re-inspection has been ordered, and the new loan originator assigned to your loan sent you an email on June 26, 2012 with a list of items that are required to close the loan. Please note that the loan is still subject to final underwriting review, the receipt of all required conditions and borrower and property eligibility requirements.
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