Don't get "Buffaloed by Buffalo Fed. Bank". When we were first seeking a home loan, Buffalo Federal Savings Bank offered us terms that seemed to good to be true. We're (gainfully) self employed, so being business entrepreneurs we're automatically discriminated for loan qualifying. After speaking with Buffalo Federal Savings Bank, they told us, based on our initial financial input, that not only do we qualify for a home loan, we qualify for an FHA mortgage, basically only 3.5% down with a decent finance rate. They told us that they were much looser on their lending standards than most banks because they were backed by casino money. We eagerly submitted our loan paperwork based on our initial qualifying. We had gone to other lenders and couldn't get anything close to these terms. The other lenders could only offer us conventional financing with a minimum 20% down payment, which we couldn't really afford.
Our loan officer, Tommy Hefflinger, and his boss, Tim Leatherman, gathered all our information based on what he said the underwriters would need. He told us repeatedly during this process that our loan was going smoothly and the underwriters had everything they needed. We constantly phoned and emailed because we needed to be reassured that we were approved for our loan as our loan contingency confirmation deadline in our purchase agreement was nearing. Basically this means that if we couldn't prove loan confirmation before a certain date, we would default on our earnest money. Both of us and our realtor were phoning and emailing several times a day to find out if we were approved or not. Tommy finally gave us a verbal approval and told us that we were clear to sign off, so we then signed off on our loan contingency. As our escrow closing date was nearing, we were having a difficult time getting in touch with Tommy and Tim.
After repeated phone calls and emails, we were told that our loan was held up in underwriting, but it was because the underwriters needed something from the loan officer and had nothing to do with us. So he resubmitted our loan info and said again everything was fine. He told us that we could lock in our loan rate but should wait a couple of days as the rates were dropping. When the rates dropped to 5%, we emailed and phoned him to let him know we wanted to lock in our rate. We signed our rate lock document and emailed it, it took us three days to get a confirmation. As our Tuesday closing date drew near, we were told that everything was almost completed and the docs would be sent to our title company by Monday. Closing was imminent and we couldn't get a hold of our loan officer to see what was going on. Our realtor was leaving messages almost every hour for this guy to return our calls so we knew when to expect docs.
We finally received a call from him saying that we were out of underwriting, the docs were being sent to the processor and then they would be sent to the title company in time. He even promised us he wouldn't sleep until the docs were done so we would get them in time. Our title company was now calling us asking us where the docs were? They had been expecting them and called us to see if we knew when they were coming and if we had our loan officers contact info. Our closing date had come and gone and no one could get in touch with this loan officer. Fortunately our realtor had a 5 day extension clause from the date of closing, in case of last minute emergencies. Since we could no longer get an answer from our loan officer any more after leaving at least twenty emails and messages over 2 days, our realtor finally called the bank headquarters to see if she could find out what was going on. She got in touch with the Bank VP and he told her that we were never approved for a home loan and that we were declined during underwriting three weeks prior to closing!
In fact, we were declined two weeks before Tommy gave us the verbal approval to sign off on our loan contingency (earnest money default). Our loan was then submitted to anther bank and declined on the 15th because of a small technicality, and we were never told anything! We were dumbfounded. We couldn't believe that we were being lied to repeatedly throughout this whole process. My partner finally called the bank VP to verify this and they had no idea what Tommy was doing. The first thing they did to cover their butts was to ask us if we had any written proof from Tommy and to forward all email correspondence to them. Pfft, most of the correspondence was done over the phone. All we had was mostly emails that imply and substantiate our actions.
We found out that we were declined initially because the underwriters needed more information from us. We were never told this by our incompetent lying loan officer. We were repeatedly assured that everything was fine whenever we heard from him. Had we been told the truth up front, we would have been able to give the underwriters what they needed. Throughout this entire process, it was like pulling teeth to get any information from the lenders, and when we did, it wasn't valid. Not only did we lose our earnest money because of this lying incompetent moron, the seller didn't want to sell us the house anymore because this saga had caused her so much stress. Our realtor talked the listing realtor into allowing us to have a twenty day extension to salvage our transaction and investment. We now had to find a different lender at the eleventh hour and close our home loan within twenty days or we lose the whole deal (including home appraisals fees, home inspection fees, earnest money, etc.). As if!
Our new lender said we never qualified for an FHA loan and that we still can't qualify for FHA because the laws have changed in the last two weeks. We now can only qualify with conventional financing with a 20% down payment. Also, because my credit now had several recent inquiries from these (Jackasses) banks, it dropped my credit score to just below the premium level to qualify for 5% financing. We now only qualify for the higher finance rate. We're now scrambling to get more money from our family to help compensate for our larger down payment and salvage our monetary investment. We were originally told we only needed a 3.5% down payment by Buffalo, which would have been comfortable and made the house more affordable, 10% down we could have still done on our own by completely emptying our bank accounts, but we were never prepared to come up with 20% down nor were we led to believe otherwise.
A friend who is a realtor called us yesterday. The first words out of his mouth were, "don't use Buffalo Federal Savings Bank". He's now in the process of legal action against them for fraud. No surprise!
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