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Can a lender arbitrarily rescind an approved mortgage application because they realized after they approved it that they don't have a lending program for the type of loan they originally said they did, which had caused me to allow them into my credit report and financial status? If anyone has any info on laws/statues regarding this topic to share, it would be greatly appreciated.
Yes, they can, and are you worried about them stealing your identity?
Per SmartMoney's post - "at the end of the day, no real harm was done." The inquiry on my credit file will be there for two years. When I go to another lender, they will see that inquiry from that institution and will research why they didn't fund the loan..
Just demand a letter of denial with a reason, specifically that they do not offer the loan you needed and it was found out in underwriting. You can submit that letter if there is ever a question.
Thanks to all for sharing your input and opinions but unfortunately I was unable to get my points across succinctly enough for your answers to help me.
It appears you are upset because you didn't get the answers you wanted.
Laws/Statutes. Laws/Statues. There must be laws/statues that lending institutions have to follow or adhere to or there wouldn't be Bank & Finance Lawyers. I never once belittled or bashed anyone's answer or response. Yes, I did hope someone would have a direct answer pertaining to laws that govern lenders procedures and consumers expectations of the process. I am VERY aware that what they want to make loans on matters. I know they wouldn't finance a bicycle, but, if they said they would finance a bicycle, put the consumer through all the hoops and hurdles, created a document stating that the bicycle didn't have wheels because they sent the appraiser out before the bicycle was finished being built, then told the consumer they would have to start the process all over again because they messed up, only to then find out after the whole process gets repeated that they won't finance bicycles, and after leaving an permanent trail of incompetence, then what I start looking for is information that pertains to their actions that have caused damage to the true facts. Down the line, the next lender will inquire into what caused the other lender not to finance. Someone will look into the file and see the first application was turned down. They will want to know the reason. The reason will state "insufficient collateral" (remember the appraiser saw the bicycle without wheels). Now they are left thinking there isn't sufficient value and not proceed with the loan. They are also told the second application was rescinded. I am a little perplexed that I come here to seek help from the community and get called names, lectured, berated and given answers that have nothing to do with the original post's questions pertaining to laws/statues for the lending industry. Please accept my apologies for seeming unappreciative.
I was a lender for 15 years and a previous credit pull from another lender was never a true issue. The client just needs to supply a short letter of explanation and state whether or not the loan was funded. A hard pull causes a minimal drop in credit scores over the long term.
The letter of explanation just needs to read that the previous lender did not offer a specific program that you wanted.
Really is "no harm, no foul" like SmartMoney said. However it is beyond frustrating that you had to deal with this problem. It is a lot of time and energy that could have been used in a more enjoyable fashion.
If you wish to pursue it further you can seek out an attorney but that would be costly. Someone made a stupid mistake and nobody intended to hurt you or defraud you.
Per SmartMoney's post - "at the end of the day, no real harm was done." The inquiry on my credit file will be there for two years. When I go to another lender, they will see that inquiry from that institution and will research why they didn't fund the loan. I know this because I worked as a credit investigator for a lender. What also happened during the course of this application process was the fact that the original application was turned down due to them sending the appraiser out too early and the home hadn't had the electricity turned on yet so he submitted his report as "insufficient collateral". They had to re-process thru underwriting again and when it was time to get the appraisal done for a second time, the original bad info from the person in underwriting was discovered and the application was rescinded. The definition of rescind is "to cancel, reverse, revoke, repeal." Their inquiry has left a permanent mark due to multiple errors and incredible incompetence. No where in my initial request did I ask anyone on this forum for help in how to make them fund my loan. I gave a very brief synopsis of the situation and was hoping someone could help in sharing any knowledge they may have regarding any "laws or statues" that would give me guidance on what rules they have to follow when leading someone into filling out an application with them or a law that might tell me how I might get this institution to restore my points and remove their inquiry. Thanks to all for sharing your input and opinions but unfortunately I was unable to get my points across succinctly enough for your answers to help me.
No offense meant, but this is quite the dramatics. If you were a credit investigator, then you are completely aware a single, random pull has no to little bearing on your score. I am curious exactly what this credit investigator job entailed, because you are missing quite a few facts. Only when a pull is combined with multiple revolving hard pulls, balances at or approaching credit limit, or multiple creditors closed accounts, does an inquiry matter, and usually when coupled with other pulls, an indicator the borrower is having issues obtaining financing. Two years? I am happy most of the industry doesn't use this standard......all of your major agencies are at 90 days, and typically inquiries drop off the report after 1 year.
I never have heard of anyone removing an inquiry because they could not provide you a loan. NEVER has any lender I have worked with in 30 years has gone so far to investigate why there was a pull AND why you didn't get the loan from them. Try again, privacy laws prohibit sharing this kind of information. Do you have any idea how many holes are in your statements? You were succinct enough, just not factual. I really fear someone trying to learn the facts are going to be unnecessarily misdirected by your statements, because they just are not true. You didn't get any laws or statutes to back you up, because there are none. If there were, every lender would be nailing their doors closed. All three of these sites support my statements. And if you feel real harm was done, you shouldn't have any problems finding an attorney to file suit on your behalf. But I'm betting you'll only get warnings about filing frivolous suits.
I say this with respect to you: SmartMoney is the most informative, friendliest, most helpful member on this website. Never snarky or mean, always completely helpful to everyone across the entire lending spectrum.
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Agree, although I think ModificationSpecialist is right up there, too.
Agree, although I think ModificationSpecialist is right up there, too.
You guys aren't chopped liver! Some of the best threads have been started by pfhtex! Mod Specialist is undergoing a career change and I suspect we will see him back soon. Loan mods have run their course (for now).
[quote=SmartMoney;42337065]
typically inquiries drop off the report after 1 year. [/b]
Boy you guys (aka - professionals in your field) sure do get defensive when you can't answer direct questions. Attacking and calling out posters, that are NOT professionals, just for asking questions which is the purpose of this forum, and just for trying to gather the correct information, is what I would label; unprofessional.
I won't go into all the aspects of proving where I am right but will leave you with just one lesson for you all to learn.
Now go high five yourselves, pat each other on the back and glory in how big your brains are.
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