Posted by Dwight GOrdon on February 27, 1999 at 06:19:34:
In Reply to: Mortgage Consolidation Loan posted by E O'Donnell on February 23, 1999 at 16:13:19:
I am in the mortgage industry, in Virginia, and I shudder every time I read something like this. Ford's mortgage arm has been so deceptive that they have literally taken people's homes away, and that is a major company. As to what any unethical company can do - it is really frightening !!
In any adjustable rate mortgage, you are to have disclosures presented to you which show the anticipated change in the mortgage payment due to 1) Coming of the intro period and 2) With possible changes in the INDEX used to calculate the rate - in this case, the LIBOR.
It sounds like you were totally unaware of the liklihood of payment changes and/or what those changes might be.
Do you remember being presented anything like the disclosure I described ? It is possible that your signature was forged on some of the required documents - this would be criminal fraud and be your best case defense. It would certainly put the companies involved out of business.
Furthermore, you are supposed to be qualified for the mortgage based on your ability to pay. When the mortgage payment is going to adjust in 6 months, it is this higher rate that is to be used in qualification. I will simplify things here, but your total obligations, including mortgage, taxes and insurance (PITI) together with your bills should not exceed 50% of your gross income.
Again, documents could have been forged showing a higher income or some of your debts that you disclosed (esp. if they did not show on a credit report) could have been conveniently left of your application. Therefore your loan approval would have been made under false pretenses - and you would have another cause of action...
I agree, go to the consumer protection ARM of your attorney general's office - and take all the papers you signed at closing along with you.
Depending on your credit, if you are making payments OK yet at this time, you may qualify for legitimate 100% financing at a better interest rate.
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