Expert: Dick Dennis - 9/23/2009

Question
Q:  I wanted to buy a house.  I used a mortgage broker who was NOT in the same state I was in.  I was preapproved for a loan.  When I found a house, my mortgage broker told me what my payment, taxes, and insurance would be.  I made an offer and it was accepted.  I put a $1000 down payment on the home.  The day came to sign the papers.  During the signing I noticed that my monthly payment was $300 higher.  After a phone call to the mortgage broker, I was told that the title company found that the mortgage broker had used the wrong state tax rate to calculate the payment.  The title company discovered the error and corrected it.  I could not afford this higher payment and so I cancelled the transaction and lost my $1000 deposit.  My question is, who is at fault?  The mortgage broker said it was my agent's fault.  My agent said it was the broker's fault.  Please help me answer this question.  Thank You.

Answer
The mortgage broker apparently was licensed to do business as a mortgage broker in the state of the sale of the house. If that be the case, he/she is the one who is at fault. He/she should have know his business better than that so that you would not have to lose your deposit. If it was me, I would take that mortgage broker to small claims court. It's going to cost a little to serve him/her to be sued in your state. You may need to talk to an attorney in your state to verify that is what you should do. Believe it or not, you may have to sue him/her in his/her state. I do wish you well.

Dick Dennis