My boyfriend is in the process of getting a home loan and his mortgage broker asked that the check for the earnest money be made out to her. I thought that the earnest money deposit was always made out to either the Title Company or Escrow Company. The check has already been cashed and I asked my boyfriend to get a copy of the front and back of check so we can see if she endorsed it and deposited into her own personal account. I've finally convinced him that he needs to pull out of this deal because her high pressure tactics seem shady and unethical. Every time he calls to withdraw, she finds another way to convince him to purchase the house. At one point she told him to just go through with the purchase of the house and she will buy it back from him two months.
Any advice would be greatly appreciated because my boyfriend is not listening to me.
2007-10-02 03:50:44 · 10 answers · asked by skie01 1 in Business & Finance ➔ Renting & Real Estate
The house that he is purchasing is a hud home and the title is held by the Secretary of Veterans Affairs. She's an actual mortgage broker and is only representing my boyfriend but if I'm not mistaking, with a mortgage broker they usually shop around your application to numerous lenders until they can find the best lender who will provide the broker with the best incentives.
2007-10-02 04:19:11 · update #1
this sounds very crooked. Earnest money is normally held in an escrow account. In Texas it is illegal to co mingle earnest money with other money. I have never heard of a loan officer having an escrow account. Is she also the seller?
Because of this and the pressure she is applying I would back out as quickly as possible-I would not wait even an hour-I would back out now!
Your boyfriend needs to decide this for himself though. It is his life, his money, and his future house.
2007-10-02 03:53:32 · answer #1 · answered by glenn 7 · 0⤊ 0⤋
The Earnest Money Check should NOT be made out to the mortgage broker. Is the mortgage broker the real estate agent on the house as well? In some cases the Real Estate Agent can have the earnest money payable to their real estate company and the funds will be held in a Trust Account. If it was payable to the individual mortgage broker than there is a big problem. You should contact the mortgage brokers boss or the state banking department to see what you should do.
2007-10-02 11:38:56 · answer #2 · answered by mateomortgage.com 2 · 0⤊ 0⤋
Although normally an earnest money check would be held by the atty/title co, or realtor in a trust acct, as long as the broker has a trust acct they too can hold the earnest money check. I think you're right about getting a copy of the check so you can make sure it was deposited in such an acct. On the other hand this broker does sound sketchy and pushy and I would try to find someone else.
2007-10-02 04:18:51 · answer #3 · answered by Anonymous · 0⤊ 0⤋
No, that is not typical. The funds should be held in escrow. Is there an realtor or real estate broker involved in this deal? The biggest red flag is that the broker is offering to buy the house back in a few months- that doesn't make any sense.
Who is the record owner of this house? Is this house in foreclosure? Sounds to me like there is something going on behind the scenes, and this transaction is not on the up and up.
2007-10-02 03:55:35 · answer #4 · answered by sarah jane 7 · 1⤊ 0⤋
In a business transaction, never make a check out to an individual. Yes, the earnest money deposit should be made out to either the Title Company or Real Estate company where it will be held in escrow. It should never be written in the Realtor's name, Loan Officer's name, or Settlement attorney's name. Report this loan officer immediately and go with another company for your financing. http://www.choicerealestate.net/
2007-10-02 04:26:04 · answer #5 · answered by Anonymous · 0⤊ 0⤋
The earnest money is to protect the seller, not the mortgage company. The mortgage company cannot go after the earnest money in this case. The mortgage company can go after the buyer in civil court as the buyer is the one who contracted the appraisal. However, it was the builder who defaulted so the buyer would then go after the builder for these additional fees.
2016-04-07 00:18:50 · answer #6 · answered by Anonymous · 0⤊ 0⤋
No, the check should not be made payable to the mortgage broker. This sounds very shady. You definately need to get a copy of the back of the check and consult an attorney. For her to suggest she would buy the home from him in 2 mths is unethical as well.
2007-10-02 16:16:52 · answer #7 · answered by yourmtgbanker 5 · 0⤊ 0⤋
Her tactics seem very strange. She should be making sure that he finds the right house, not just the first house available so that she can make the sale.
When I put in my purchase offer I made the check out to the company of the selling agent (not the agent herself).
2007-10-02 03:54:55 · answer #8 · answered by Rachel 6 · 0⤊ 0⤋
Earnest money is always made out to the seller.
2007-10-02 04:28:26 · answer #9 · answered by Leo F 4 · 0⤊ 2⤋
no the deposit has to be made in escrow account
2007-10-02 04:21:16 · answer #10 · answered by Fabio G 3 · 0⤊ 0⤋