PREMIER MORTGAGE AUDITING

Exposing Fraud and Damages in Home Mortgage Loans

Premier Mortgage Auditing (“PMA”) is the leading institution on predatory lending abuse and practices relating to mortgage home loans. Predatory lending is the practice of exploiting a potential borrower’s ignorance for profit by fraud. A majority of governmental agencies define the term predatory lending as ‘granting loans without regarding the borrower’s ability to repay.’ By doing so, this practice has grown into a multi billion dollar industry for lenders.

 

Predatory lending encompasses a variety of situations, such as, check-cashing outlets for payday loans, car title loans, refund anticipation loans and rent-a-center loans amongst other things. One of the largest investments for an individual, a group of people or a couple is usually the purchase of a home. With respect to home mortgage loans the following situations are some examples that entail the fruits of a predatory lending regime, and at most, are always instigated by mortgage brokers and lending institutions:

 

• It is putting people into a loan that does not benefit them.

 

• It is not disclosing the true cost of the loan and the actual terms and payments of the Loan.

 

• It is deceiving people, promising them one loan and then at closing, you’re getting a loan that is totally different than what you expected.

 

• The interest rate is not what you were told or expected.

 

• The payments are higher than what you were told or expected

 

• They are not paying off the debts they said that they would thereby deceiving you.

 

• You are not getting the cash out that you were promised or anticipated.

 

• Instead of the Fixed Interest Rate you were led to believe that you were getting, you are being put into an Adjustable Rate Mortgage.

 

• You are put into an Adjustable Rate Mortgage without a clear understanding and disclosure of what the true payments of that ARM could and would be.

 

• You are being charged undisclosed fees, Yield Spread Premium.

 

• You are being charged junk fees, Broker Processing, Application Fee, and Administrative Fees.

 

• You are being charged fee’s that usually have no benefit to you “Discount Points” when you are not buying down the Interest Rate, the list is endless.

 

The making of promises to obtain quick-cash and easy-credit at low interest rates is one of the means by which many consumers are hauled into predatory lending abuses and practices.  In time, such promises prove to be false which trap many consumers in a cycle of high interest payments, abusive fees, illegal kickbacks, terms that can lead to foreclosure, which ultimately devastates a borrower’s financial future and ability to pay.

 

The Center for Responsible Lending (2001) estimates that predatory mortgage lending practices cost borrowers at minimum $9.1 billion annually. (Eric Stein 2001. Quantifying the Economic Cost of Predatory Lending, Center for Responsible Lending, Durham, NC).  Certain loan characteristics (e.g. prepayment penalties, balloon payments) substantially increase the likelihood of foreclosure and most notably jeopardize homeownership.

 

§         The Concept of how Predatory Lending happens?

 

Some Mortgage Brokers and Lenders will do what ever they have to do to get you to sign up for the loan. Lie to you; tell you whatever it takes to get you to sign on the dotted line for the loan. This way they have taken you out of the market. They start by looking at your Credit Report to see what condition you’re in financially. They look at your Credit Scores and then look to see if any of your payments have been late. Are you behind on Property Taxes? 

 

This way they can tell what they can do with you as far as fees are concerned. If they can see that you’re doing alright financially, you have a good credit rating and your payments are all made on time, then they will charge you reasonable upfront fees but then they will add an undisclosed “Yield Spread Premium” (“YSP”), junk fees like an Application fee, Administrative fee, a Broker Processing fee, Discount fee and hope you do not question these fees at closing and if you do, no detailed explanation is forthcoming of its calculation and how they arrived at that calculation.

 

If your credit score is not that good and they know that some of your payments have been paid late, they do whatever they think they can get away with. They tell you a better Interest Rate fully knowing that your rate will be higher at closing.  They will charge you an Origination fee, Mortgage Broker fee, an undisclosed “Yield Spread Premium”, Application fee, Administrative fee, a Broker Processing fee, Discount fee and really don’t care if you see those fees at closing or not. At this point you probably don’t have a choice than to close the loan, and they knew it. 

 

They would purposely tell you not to pay the mortgage, 1^st and 2^nd, not to pay on your Car or Truck, not to pay the credit cards they are paying off, this way when you get to the closing and everything has changed, your Interest Rate and monthly payment is higher than what they promised you, the Cash Out amount was not what was promised, nor were the debts they promised to paid off. Everything was different, but they are counting on the fact, unfortunate for you, the money you saved by not making those payments you spent on something else.

 

This way you do not have the money to catch those payments up, so basically, if you did not go through with the refinance, you may be in a world of trouble. All those payments would start to show as late on your Credit Report, your scores would go down and there would be a good chance that if you didn’t close the loan, you may not get this good of loan, if any loan at all. 

 

Loan Officers are instructed to go to the home and take the Application and have you sign all of their documents. This way, they could not give you a copy because they had to go back to the office and type everything up, but they would send you a copy. They never send you a copy because they did not want you to have proof or remember exactly what they promised you to get you to sign. The same happens if they would take an Application over the telephone. They would not give you a copy of anything until closing.

 

This is just an example of predatory lending tactics and abuse. You have a Right BY Law, Federal and State, to receive a copy of your Good Faith Estimate, your Truth-In-Lending disclosure within 3 days of taking your Application. If anything changes on the Good Faith Estimate; the Interest Rate changes more than 1/8% on a purchase, ¼% on a refinance or any fee that changes within $35.00, they have to re-disclose within three days of finding this information out, but no later than 3 days before closing. The same applies for your Truth-In-Lending disclosure.

 

Federal and State law require these disclosures so that you have a TRUE AND ACCURATE COST OF YOUR LOAN and so you can make an educated decision if you want the loan, could afford the loan, or did you want to shop for a better loan. With this in mind, Mortgage Brokers have gone as far as to even open their own Title Companies, just to make the process easier for them to get you into that loan, and all they do is keep making more money not caring what they did to you to make it. As a result of this Premier Mortgage Auditing was birthed to put a stop to this.

If you feel that you have been a victim of predatory lending contact PMA immediately for an initial consultation regarding your current circumstances and fee arrangements. This consultation may lead to a full audit of all your documentation and closing paperwork. Our goal is to provide you with the best service and customer care in the audit and assessment of your case.  It is time to fight back and seek compensation and damages for the abuse that you have experienced.