I have written several times about FHA mortgages and how I am not a huge fan.  Well once again, I can tell you why.

A client had gone to a mortgage company in Brooklyn to obtain an FHA loan.  They will remain nameless, because I do not name names!  The loan officer was (how do you say) totally ripping them off.  A colleague referred them to me to see what I can do and based on the loan profile, I had to do it FHA.  I sent the loan to M and T Bank in New York, one of the largest providers of FHA loans.  I was able to get them a loan with ½% lower interest rate and save them a 2 point fee they were paying to the broker in Brooklyn.  Yow!  That was $15,000 out of pocket and a lower monthly payment $224.  Need I say more?

Here is the catch.  The mortgage broker in Brooklyn had registered the loan with FHA and obtained a FHA certificate number.  They would not release it to M and T Bank. Refused, said they did not have to, said they could match the rate….why now! They told the client if they could match the offer, the loan would have to close with them!  What BS.  They should be ashamed.

If you start out doing your FHA mortgage with one company and want to switch, you have to get the FHA certificate transferred.  The first company is the one that has to release it.  They have to, so if they give you 24 hours of hassle, call the banking department and the FHA office.  They will call them and make them to it.

I looked up this company with the BBB and they had a list of complaints up to my elbow.  This is why I do not do FHA loans.  Go to a bank!!  Had a bad experience, let me know.

Dale Siegel