Bank of America, Wells Fargo... it doesn’t seem to really matter how big or prestigious a lender is. Everywhere you look recently there are stories that send a chill down any homeowner’s spine. According to Consumerist, The New York State Attorney General Eric Schneiderman planned to file a law suit against Wells Fargo for not complying with a $26 billion settlement that was put into place in September.
The settlement, which includes over 300 different standards that banks and lenders are required to adhere to and apparently Wells Fargo is one of them that’s not doing it. Supposedly they’re one of several that are breaking the rules on even the basics. Like what? Like giving written acknowledgement within three days of getting a loan modification application, letting borrowers know if there are required documents missing or allowing them a 30-day period to submit those documents. Is that any surprise to anyone else? Not to me.
More recently, Bank of America is in trouble. Just last month Consumerist ran another story about Bank of America flat refusing to give home loans to women because they were pregnant or on maternity leave. They’ve agreed to pay a settlement fee. That’s really going to stop them from doing it again, right?
Back during the summer, it was reported that Bank of America ex-employees said it was common practice to offer gift cards and other incentives to those who initiated the most foreclosures or rejected loan modification applications.
So how do you know you’re getting a fair deal and being treated appropriately when getting a mortgage or trying to adjust one?
The Consumer Financial Protection Bureau (CFPB) is attempting to make it easier with a “Know Before You Owe” rule. The current federal disclosures that accompany a mortgage will be replaced with an easier to understand version that consumers can (hopefully) make better decisions with. But until then, here are a few things to keep in mind:
• Make sure you know important dates. These could be dates that your capped, discount or fixed rate will end.
• Make sure you know and understand the fees that are associated with modifying anything before that date comes.
• Understand what you'll be paying after that date.
• Understand how flexible your loan is. For example, will you be penalized if you make larger payments from time to time?
• Know the maximum loan to value (LTV).
Never rush into a contract, even if something seems like an amazing deal. Talk to your bank, other lenders, brokers—heck even friends and family may be able to tell you about who they used and what their experience was in order to help you make a good decision. Take advantage of the internet and social media. With just a quick search I came across this site for U.S. Mortgages and this one for the U.K. (Please not I have not used either and don’t know about them personally—just going off the actual site, the info they provide, how helpful they seem and their BBB rating).
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