I walked into Washington Mutual Home Loan Center to make application for a mortgage. The loan officer explained that my credit score was not what Wash. Mutual would want for a jumbo loan. He explained that they (Wash. Mutual) owned a "branch" lending institution, a subsidiary company who had the perfect loan package for me. He would have the fellow who ran that program contact me.
Mr. Scott Newhaus contacted me and proposed a mortgage that suited my needs. I was told that he gave me a first and a second mortgage, a four option arm with a monthly payment spread beginning at under $2,000 per month payment. He never told me about broker fees (and of course, I thought this was Wash Mutual not a broker) and no pre-payment penalty (he explained that he never wrote prepayment penalties because he wanted me to refinance and keep me as a customer!).
One excuse after the other why I never received my written good faith estimate. Four weeks later and the night before closing, my payments doubled, five year prepayment penalty of 2% and I find I am working with a scheister broker and he is charging me a 1% commission fee on not the borrowed amount, but the sales price of the house. A broker fee of $17,000! If I don't like the terms he tells me, don't close.
I did not close, defaulted my contracted and was left homeless. Days later, when the real lender, World Savings, agreed to release the prepayment penalty clause, Scott Newhaus refused to agree unless I paid him the $8,000 in his lost commission by the withdrawal of the prepayment clause. I had to pay so I could close. Extortion - criminal behavior!
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