Recently, as interest rates rose and the number of files on their desks exploded to record levels, some mortgage companies bailed out on clients and failed to close. In two cases I was involved in (both of which are new construction) the mortgage companies literally “forgot” about the client. The loans were not ready to close because no one paid attention to the file for months. The other problem is that some lenders blow the “lock-in” period. The client is left with a lame promise that the mortgage company will do a “free refinance” later to cure the problem.
How can you prevent this? Pick a reputable lender in the first instance; not one from the internet or your brother-in-law who thought he would try out mortgage brokerage. Stay in touch with the lender. If all else fails, file a complaint with the office of banks and real estate. Here is the form to file the complaint:
It rarely pays to file a lawsuit against the lender. Attorneys fees are cost prohibitive and your damages are hard to prove.
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