An Angry Consumer is a Formidable Opponent

I received an email recently from a woman who had read my Active Rain posts.  From her message, I gleaned that a lender had taken advantage of her during a refinance transaction.  I receive similar emails fairly often, but somehow this one was different.   The lady's name is Paula and she wasn't looking for an elixir to somehow solve a serious problem.  She had already taken a stand and had decided to make a difference.  Paula had written to tell me about her newly launched web-site. 

That's right, a site hosted by an angry consumer who is fighting back.

Before reading more, consider these points:

• Consumers are intelligent.
• Many consumers are tech savvy or know someone that is.
• Consumers have the ability to educate themselves on-line.
• We can expect to see blogs hosted by people who are angry at their real estate agent, loan officer, etc.
• Consumers will mention names on their sites.
• SEO can be used against real estate professionals.
  

Will blogs hosted by BITTER CONSUMERS compete against REAL ESTATE BLOGS  in google searches?  

What happened to  Paula?

Paula's home is in Baltimore's northern outskirts not far from my own.  She refinanced last year with an out-of-state lender.  Her closing, or signing rather, was conducted in her home by a mobile notary.  I'm not sure why Paula questioned the terms of her loan after it's consummation, but she did.  Paula learned that the value used for her refinance had been grossly inflated.  

As is often the case, she has been unable to obtain a copy of the appraisal even though she had paid for it.  Maryland statute clearly requires a lender to provide a copy of an appraisal upon the request of the borrower.

Paula also learned that an undisclosed Yield Spread Premium of mammoth proportion had been charged.  I won't elaborate on her specific YSP since it was discussed on the phone, but will tell you that I often see settlement sheets with YSP's equaling $20,000 or more.  Last year, I meet a woman named Chris who asked that I look at her loan documents the day before closing.  Her settlement sheet reflected a YSP of nearly $30,000.   Additionally, the lender was charging  $9,000 in points and fees.  Chris, had impeccable credit and an LTV that would make most people envious.   She settled a week later with a different lender, reasonable broker fees, a much lower interest rate, and no YSP.

Now, back to Paula's story.  It turns out that the mobile notary worked for a company that was owned by a title insurer.  Most people don't realize that there are only five sources of title insurance left in this country.  Paula had been overcharged by nearly $1,000 for recordation fees by a national title insurer who was non-responsive to her repeated requests for reimbursement.  She eventually received the money back, but it cost her considerable time and effort.

A consumer advocacy site hosted by an intelligent and concerned consumer

I'm simply amazed at the size and scope of Paula's web-site.  It's not a blog, but I noticed that new information is added frequently making it blog-like.  It's a virtual information center for disgruntled real estate consumers from across the nation.  Paula designed the site herself based on her own experiences and very comprehensive research. 

Through the power of the internet, Paula has become a veritable expert on the mechanics of a real estate transaction. 

A consumer wouldn't have been able to accrue so much information five years ago. 

There's one more thing that I eluded to earlier .  Paula mentions names on her site.  She's not worried about defamation suits because she's telling the truth.  You can't sue someone for telling the truth.

Paula's site, Lender Liability Law, is worth visiting.