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I used my builders mortgage company (they own the mortgage company) and we closed last week in TX.
They screwed up on the HUD and didn't charge me for a couple things (title insurance, fee for waiving escrow) and now the builder isn't signing off or allowing the loan to get funded until I pay the difference. This was the 3rd HUD they prepared. I pointed out to them that the first 2 had error's the day before closing. I figured that by the 3rd one, they would have made all the corrections. They never provided me a final HUD before closing and I had to figure out myself how much to bring to closing the next day. I had brought the money to closing to pay those items and they refunded me at closing saying I figured it wrong.
There were also other mistakes made by them but it's kind of irrelavant at this point. They want me to close again and pay. I told them no dice, I'm not taking another chance of them screwing things up again (especially when this one went in my favor). Their mistake, their problem is how I am looking at it.
Am I right, do I have a leg to stand on here?
Were you paying only for lender's title insurance, or were you getting an owner's policy as well? If just lender's and escrow fee not charged, I would hold my ground and not pay. But, if you want an owner's policy I suppose it could pose a problem that it was not paid for. Of coarse I think you can generally buy an owner's policy directly from the title company within 30 days of closing, so that may be an option.
The loan officer and processor should have reveiwed the HUD. If they left off a couple of fees they should eat it. Were they intending on charging you a 1/4 point for escrow waiver? I think they will have to eat these fees they missed.
Read your contract carefully. It may have a clause in it (very common) that requires you to pay for the mistakes. If it is not specifically outlined in the contract, you may be ok. Be sure to have a RE attorney review it.
I just got off the phone with the VP of the mortgage company. I did sign the clause with the title company and it was for the entire title policy (both sides). The contract simply stated that I would receive the incentive and was responsible for closing costs. It didn't break them out though and those are typically negotiable so that could go either way if it came down to it.
The .25% for waiving escrow wasn't in the contract or in anything other than an email.
So I told them I'd pay the title policy and they can eat the escrow charge and they agreed. What a pain.
where did you find a lender willing to waive escrow?
according to this site : Waive Escrows
the lender is basically on the hook if you decide not to pay your taxes. And in many states a tax lien will take priority over any mortgage liens.
If you put a sufficient amount of money down (at least 20%) many lenders will waive escrow. Especially true if the payments fall at 25% or below your take home pay, so I have learned. I did not have any problem at all waiving escrow (no extra fee for me). I put an amount equal or greater than what my escrow would be in a separate savings account each month. I get any interest on that account instead of the lender.
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