Question by fallin_angel_rising_devil: Shady personal loan by mortgage broker?
A couple of years ago I was trying to get approved for a mortgage with my wife. we had some credit debt but overall we were ok. When my mortgage broker saw the 30k in debt he said he could get us a personal loan through an investor. Having no options we took the loan to pay off our debt, and get approved for a mortgage. Turns out a family member who also uses this mortgage broker came into money that they wished to invest. The mortgage broker thought he had the ideal situation by lending the money from my family member to use at interest. Basically he forced us into business with family and did not tell us. the family member didn’t know either. The plan was to refinance after 2 years when the loan adjusted ,and pay off this personal loan having only paid 2 years of interest only payments.With the bad economy there was nothing left in equity.So having not made a few payments (due to not receiving any statements or acknowledgment of payments) both parties put pressure on the mortgage broker to resolve the issue when he decided to inform the parties were actually family. First question is this even legal.Is there any recourse?
Best answer:
Answer by marisa
False representation and if you signed a contract take that to an attorney outlining your rights. They have to have a business license to pursue, family or not. No business number, not legal. Take all documents you have and seek legal advice. You may even take to small claims court for retribution to protect your interests and your situation.
When they stopped sending statements (was that intentional)? You have the rights to review your monthly account status without penalties. Was that ever provided and did you request?
Mortgage brokers have regulations to follow. I dont know what they are, but this one seems to have overstepped his bounds. In additon you can file a formal complaint and have this mortgage broker audited or licensed revoked for fraud.
Know better? Leave your own answer in the comments!
probably not, you needed the money and they wanted to invest it this way… the fact that you are related… is just that… you are related… so you both own a home… it would be in the best interest for both of you to keep the mortgage paid until the market comes back…
People use private investors to help with real estate all the time. It isn’t shady and nobody forced you to do anything. Like a lot of people, had you known the real estate market was going to collapse so rapidly, you wouldn’t have made the deal you made. At the time, it probably seemed like a good idea. If you accepted the loan, I don’t see how it’s the realtor’s fault. Are you thinking it would be easy to just default on the loan if the money had come from a stranger instead of a family member?
Ok…I hate to tell you this, but NOTHING that took place was illegal…except for the fact that if the mortgage company that did your loan did not know of this debt…then that is a case of loan fraud not only on YOUR part (b/c you knew of the debt and signed an application agreeing to disclose all debts) but also the mortgage broker.
So you would be in just as much trouble as he is….so you are out of gas on that deal.
Here is the problem:
You have the contract with the investor…where the investor got the money from is NONE of your business. You DO NOT have a contract with the family member…the two are not related. You also don’t know for a fact that this is the source of the loan either.
You obviously didn’t have a problem with getting your debts paid off. You obviously didn’t have a problem with defrauding the mortgage company (b/c the mortgage company already declined you because of DEBT which you conveniently hid)…and NOW you crying foul b/c your house didn’t appreciate like you thought it would?
it’s not fraud..it’s Karma.
PS: No law requires ANY lender to send you acknowledgements of payments NOR monthly statements…all they have to get you to sign is a note….which you obviously did. If you paid cash you should have been given a receipt. If you paid with a check then you should be keeping records of cancelled checks.
Marisa is also incorrect. If the family member put money with a 3rd party that does private loans…that requires a business license but the family member does not have to have one…the investment firm only has to have one (and most likely does). Also, a SINGLE loan between two parties DOES NOT require a business license…at all…in any state. You only need a business license if you are negotiating loans on the behalf of others.
Your note should state WHO gave you the loan…did you not read it?
Sorry, you are out of gas.