Legal Question in Real Estate Law in Utah

Mortgage broker lied and ripped us off

My wife and I applied for a loan with a mortgage broker in Utah. We live in California. It was 100% financing. Our FICOs were in the 720-730 range. We wanted an interest only on the 1st & a fixed on the second. We were promised a few options to choose from & ended up at closing table with a bad loan. I did get a good faith estimate a week prior & called the broker to complain. I was told it was not the loan and to throw it out. Naive as I was I did. It was the loan we got. We signed out of fear. The 1st was an ARM 7.15% with 6 month penalty for 1 year and the 2nd was 10.95% Fixed. We complained after escrow were told by the broker that they would refiance us within 30 days. What a lie. We applied for pre-approval 2 months prior to closing and 1 month before we had the condo. She said she could close in 2 weeks and on week 4 we had no info on the loan to come. Then we were told if we refinance after 3 months of payments with smae lender no penalties would apply. Not so. Can I take any sort of legal action? We are in financial difficulties now (3 months later) and our FICOS are 630-650 now. Refiancing with no equity, bad credit, penalties, and closing costs is not possible. What are my options. Help!


Asked on 7/06/05, 11:52 pm

2 Answers from Attorneys
Alvin Lundgren Alvin R. Lundgren, L.C.

Re: Mortgage broker lied and ripped us off

Under Utah law you may have a cause of action against the broker for misrepresentation. There should be some sort of agreement which covers the terms between you and the broker - those terms together with state legal requirements will provide the basis for determining exactly what you can sue for. Unless the broker is licensed in California, you will have to take action in Utah. You may call for a free consultation.

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Answered on 7/08/05, 11:47 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Mortgage broker lied and ripped us off

I think the first question is whether this broker had a California license. Anyone doing business with loans secured by California real property needs to be licensed as a broker by the California Department of Real Estate. If this person lacked the appropriate license, you have substantial rights. Otherwise, you probably still have a case, but proving it and establishing your right to recover damages, and their amount, will be a lot more difficult.

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Answered on 7/07/05, 11:57 pm


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