Somebody Tell Me What I Am Missing (Charlotte: foreclose, mortgage)

[TryingToEscapeTheMadness]

We are in the process of refinancing our home in the Charlotte area with Bank of America. Almost done and our appraisal comes back at $40,000 more than the banks preliminary estimate so they want to charge us over $500 in fees because the loan to value ratio is higher instead of lower. In other words instead of doing a refi at 85% ltv it will be 76% ltv.

I don't get it. Our loan creates less risk for the bank but they want to charge us a penalty fee because our home actually has some value?

Can somebody explain this to me? Obvioulsy we said not thanks and they said okay, see ya, bye.

[lumbollo]

I'm not sure what you are asking. Are you asking if BofA is a place you can trust to do business with? IMO, no. I recommend you find a credit union, join it, and get your money out of the big banks.

[TryingToEscapeTheMadness]

I guess my question is -- Is this normal that someone with decent credit and equity in their home is charged an extra fee. The loan officer sent me an email and stated we were being charged the fee because the fact that we had more equity in our home than they (the bank) thought, was placing us in a different "pricing bracket"

[Fireflychik]

I think it is one of those little "fines" that don't ever really make sense, but is just standard practice for that particular company. I would think they would base it off the loan amount, not the current value.

I found BofA to be impossible to work with when I was applying for a mortgage a few months ago. I took my business over to BB&T, and am currently closing all my BofA accounts, because I no longer wish to do business with them. I think they have horrible practices.

[TryingToEscapeTheMadness]

I think we may be right behind you Marie. We also have all of our accounts there as well but the customer service is the worst.

[Nick-Gerz]

Did you apply directly with Bank of America or are you using a broker? Either way all fees can be negotiated, especially with a broker.

Most likely the salesperson (broker) created this fee because they knew you would pay it. I bet they probably offered to just finance it in as well, as their counter response if you brought it up as an issue? lol

[Nativechief]

You see if you have too much equity you may try to borrow on that too and then BOA couldnt get the entire homes value from you if they foreclose later. They want to know up front that you will be on the hook just to them and this makes it easier for them to jerk you around...They want you to be their economic slave and not share you with another loan company,,,,they want it all..

[chicagocubs]

That is not the normal practice. Usually, the pricing is lower if you have a lower CLTV.

However, if you leave, be forewarned that the appraisal cannot be used at any other lending institution.

[Rmercer]

BofA strikes again. They take money from the goverment's forced hand then take it out on us. Plus that lewis ceo. poor fella but nothing will come of that issue either. Leave the bank alone and store cash at home. But no that makes no sense to charge more, do they have a chart or anything to show why this is??

[lumbollo]

Anyone who lives, works, or goes to school in Mecklenburg County can join the Charlotte Metro Credit Union. Plus there are other credit unions in the city that you may be eligible for. These places offer full banking services but they don't have a profit motive. You will find better rates, better service and banking like it should be. There is no need to do business with BofA or Wachovia/Wells and their mercenary banking.

So close your accounts and move your money. Oh, when you take your money make them give it to you in cash which they are loath to do. If they write you a check, the last stab they take at you is they will write it off an account in Texas or some place like that and that can cause a hold at a new institution due to banking laws. One last chance to profiteer off of you.