Any lawyers in the house?

[wyvrn]

I was trying take a line of credit against equity in a property that I own to do some repairs. I applied for this loan about 3 months ago with a large, well-known mortgage company. This is the same company that holds my mortgage loan on said property. I have never had a problem with them before, but now I feel like I may need to know my legal rights.

The details:

I signed a standard loan contract, closed on the loan, but the closing agent was not knowledgable and left out some paperwork. (We closed at a legal office). It took over 6 weeks to get that sorted out, and in the meantime I lost the rate lock on the loan. I think this is ridiculous because it was their mistake, but was willing to put up with it if we could go ahead and close the loan. I plan on paying this loan back pretty quickly, so the interest rate isn't a big deal. The loan proceeds were supposed to be distributed over 2 weeks ago, but we are still waiting. Emails and phone calls do not always get answered, and even when they do, I get the runaround.

Now I have decided that I would rather cancel this contract ( I think they must have breeched it somewhere) and find another company to do business with. I still have not received loan proceeds, so I feel like the deal has not been finalized. Short of reading my contract and hiring a local lawyer (which I might have to do), is it within my legal rights to cancel the line of credit due to the problems I am having? I am not a legal guru, any help is appreciated.

edit: I have been told yesterday afternoon that the funds are being sent overnight and will arrive today or tomorrow. Finally after 3 months!

 

[PAB]

As long as you're not leaving a balance on the line - you should be able to close the line.

Be advised that before they even write a line, they're going to put a lien on your property so you might want to look into that.

 

[orakle]

Maybe you could send a PM to DevilsAdvocate? I'm not sure if this is his area of practice but he could probably help you out.

 

[wyvrn]

I requested a check be disbursed at closing for part of the line, so that I could go ahead and start with the repairs. However, I have not received a check yet. So I'm thinking I can just cancel it.

The other question I have is fees. The lender paid all closing costs, and I wonder if I cancel, even for legit reasons, if they will try to come after me for those.

 

[Dragoon42]

Originally posted by: wyvrn
I requested a check be disbursed at closing for part of the line, so that I could go ahead and start with the repairs. However, I have not received a check yet. So I'm thinking I can just cancel it.

The other question I have is fees. The lender paid all closing costs, and I wonder if I cancel, even for legit reasons, if they will try to come after me for those.

I use to do home equity line loans. The company I worked with, would pay the closing costs, but there were always stipulations to it (had to make a certain withdrawal and keep that money out for like 2-3 months). I've seen what you're going through plenty of times. Most of the time, the customer does enough bctching that it does get to a higher up. The higher ups are usually the only ones with enough authorization to fix this kinda mess. Btw, what documents were missing?

You also should not have lost the interest rate (unless it adjusts with prime rate, and maybe prime rate went up?). If it's a fixed rate loan that doesn't adjust with any market, then the rate should have stayed the same.

 

[QED]

Originally posted by: Dragoon42

Originally posted by: wyvrn
I requested a check be disbursed at closing for part of the line, so that I could go ahead and start with the repairs. However, I have not received a check yet. So I'm thinking I can just cancel it.

The other question I have is fees. The lender paid all closing costs, and I wonder if I cancel, even for legit reasons, if they will try to come after me for those.

I use to do home equity line loans. The company I worked with, would pay the closing costs, but there were always stipulations to it (had to make a certain withdrawal and keep that money out for like 2-3 months). I've seen what you're going through plenty of times. Most of the time, the customer does enough bctching that it does get to a higher up. The higher ups are usually the only ones with enough authorization to fix this kinda mess. Btw, what documents were missing?

You also should not have lost the interest rate (unless it adjusts with prime rate, and maybe prime rate went up?). If it's a fixed rate loan that doesn't adjust with any market, then the rate should have stayed the same.

QFT.

Most HELOCs (Home Equity Lines of Credit) are variable-rate loans-- so if the index rate (usually prime) goes up, so does your interest rate. It has nothing to do with your lock period or anything like that...