Refinancing Rituals Gone Wrong
By Jennifer Calonia • October 30, 2013
The act of refinancing a home can be a huge help in relieving the stress and financial strain of monthly mortgage payments. But, for Bennie Waller and his wife, refinancing their central Virginia home became a nightmare of a process.
“My wife and I were preapproved for a 2.75% refinance on our primary residence, subject to an appraisal,” Waller recalled. “The appraisal came back well within the 80 percent loan-to-value needed to refinance.”
Shortly afterward, however, the couple’s loan was declined with a letter from their lender citing “valuation issues.”
“I spoke with the company to no avail, [so] I filed a claim with regulators quoting from the Dodd-Frank Act and supporting documentation,” Waller said. His complaint, addressed to the Office of the Comptroller of the Currency, resulted in the couple’s loan being reinstated. But the struggle to get the home refinanced didn’t end there.
“We continued to get the runaround from the company requesting duplicate documents, contacting our employers multiple times, insisting that they could not verify our address, etc.,” Waller said. “I told the company that I would not give them any reason to turn this loan down, which is what I believe they wanted.”
Waller revealed that, because he and his wife were looking to refinance through their original home loan lender, the financial institution stood to lose about $60,000 in interest charges. Given such a substantial loss to the lender, it’s no wonder that after six months of endless roadblocks, the lender still made a last-minute attempt to deter the loan approval.
“The day on which we were scheduled to close at 12:00, we got a call five minutes prior to closing saying they would not be able to meet this deadline,” Waller said. (The closing service is owned by the lender.)
Waller, who is a department chair and professor of finance and real estate at Longwood University, explained that his diligence in seeing the refinance through to the end is what finally got them through the nightmare.
“I do believe that if it had not been for my background and industry knowledge, this company would have denied the loan,” he said. “From the time we were preapproved to closing was over six months; it was our knowledge and persistence that kept this loan alive.”
Photo credit: Sean MacEntee
