I am a self employed with low income on my notice of assessment. Recently bought a house from builder, was looking for mortgage. With my low income, mtg approval got difficult. I come across one agent at TD, a mobile mortgage agent (for privacy, I am not putting the details) got it approved but for only 5 year fixed. I personally wanted to go for only variable, But this agent says, because of my salary/notice of assessment, I can not get me the variable. Only option is 5 years fixed.
Up on repeatedly asking him, what we can do to get variable, he said, there is something called BUYOUT or BUYBACK option. In which the home buyers pay some fine upfront, even before closing. Then bank can get us the variable/preferred rate. I thought, its one of the mortgage policies and I agreed. Just couple of days before the closing, the agent came with the documentation, and asked me to pay the agreed fine in cash. And I don't see it (the details, so called prepaid fine) in the agreement papers anywhere. He was insisting, thats how it is going to be. And closing being just days ahead, I had no choice, but paid him in a cheque rather cash.
Closing completed everything is fine. I got variable at GREAT rate, (clearly better than market variable ratet), compared to originally agreed 5 year fixed (much higher than what other banks offered for same 5 yr fixed). All looks okay, from mtg point of view. But, I feel, something fishy about the fine, he took upfront on his name, rather bank name. I think, he is making use of complicated mortgage rules/grey area. We all know with a simple email, can get his business out. I don't think, he is the person to run away with cash.
Any body has similar experiences? How common (&what situations) a mortgage agent can take money from home buyers, with no receipts/documentation?
Last edited by yempip on Wed Apr 19, 2017 5:21 pm, edited 1 time in total.
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