Legal Question in Real Estate Law in California

Good Faith Loan Details Changed Less Than 24hrs Before Signing of Loan Papers

The good faith loan details on the loan we were approved for changed the day before we were to sign loan and escrow documents for the purchase of our first home. We were presented with charges for one more point (~$1,000) and $500 of mortgage broker processing fees. The next morning (before signing at 12pm) we called the mortgage broker asking questions but they could not fully explain why there were discrepancies from the original good faith.Because of the short notice we went along and signed the papers so as not to inconvenience everyone that had been involved in the purchase of the home. Is it possible to retrieve the extra charges, time, and anguish spent for the effort in small claims court?


Asked on 1/30/01, 1:17 am

1 Answer from Attorneys
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Good Faith Loan Details Changed Less Than 24hrs Before Signing of Loan Paper

If you were relying upon a good-faith estimate by the lender and not a commitment, you are very unlikely to recover anything and suit would not be an economical choice. I have seen "hard money" lenders pull out at the last minute, leaving the would-be buyers with no way to close and in danger of losing their deposits. You might have some chance based on an oral representation, but not a good one. Loan brokering is a tough business and little sympathy is exhibited for the hapless borrower.

Read more
Answered on 3/16/01, 12:15 am


Related Questions & Answers

More Real Estate and Real Property questions and answers in California