Legal Question in Banking Law in Oregon

mortgage lending

We applied for a construction loan for a manufactured home to be converted to a fixed rate conventional. At time of application the lender said that the interest rate for the conventional loan would be the same as for stick built homes if the home was put on a foundation. The good faith estimate and the subsequent commitment letter noted an interest rate consistent with their rates for stick built homes. After than we signed the loan papers at the title company and elected to float on the conventional loan rate. Now that the home is near completion the bank tells us they no longer offer the same interest rate for manufactured home on a foundation as for stick built and the rate for our manufactured home on a foundation will be about 1.5% higher. They still advertise on the internet to this day that they treat manufactured homes on a foundation identical to a stick built. Can they change their policy on us like this in midstream after listing the lower interest rate on the good faith estimate and the commitment letter? Seems like a bait and switch doesn't it?


Asked on 2/01/08, 8:51 pm

1 Answer from Attorneys
Andrew Svitek Svitek Law Group, LLC

Re: mortgage lending

Yes, you may have a point and should have a lawyer evaluate this further.

My main interest would be to see exactly what was agreed to in the closing documents. Everything else -- whether the broker no longer can get that loan, or what is listed on the website -- may be interesting for a major case, but for your purposes you want to fix this with the minimal effort.

Minimal effort would involve understanding (and enforcing) the written terms of your agreement, assuming they say what you have stated.

You may have a more complex case of misrepresentation against the broker, which would take more factual analysis.

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Answered on 2/16/08, 5:15 pm


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