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My wife and I recently attempted to buy a home but were unable to settle on a suitable loan. We backed out, but now our mortgage broker is asking for $500 to pay for the appraisal. I had never agreed to the appraisal (I didn't even know it was happening until after the fact), nor had I ever agreed to a loan in the first place. Had I done something to implicitly agree to the appraisal (and therefor owe my broker the money), or is this his responsibility?
Did you write a contract on a property? Did you promise in that contract to get the property appraised in order to meet the loan conditions? If yes, then you owe $$ for the appraisal.
I believe the appraisal is part of the loan process regardless. So, to be honest I don't see you getting out of this. You may be able to negotiate the fee down, so I would just ask. Did you sign anything or agree to anything before they started the process? It may be worth asking for the document that states that you agreed to pay for the appraisal should the loan not go through...
If you never agreed to the loan or gave permission to do the appraisal, i dont think you are obligated to pay for it. Did you sign loan documents and send them back to the broker with your documentation such as W2's, pay stubs, etc...?
Specifics: We did send information (tax documents, etc.) but never signed a contract. We were given a contract, but on reviewing the costs outlined in that contract we decided not to progress with the loan. Therefore we never signed, and never returned it.
So you never signed the purchase contract? If not, i wouldnt pay the broker anything. The broker should have waited until he/she had a signed and executed purchase contract before ordering an appraisal. I personally do not order the appraisal on a purchase loan until after the client has done the home inspection. If the home inspection goes bad and client decides not to buy, no reason to do an appraisal.
It seems, from the information you gave, the broker jumped the gun and now has to pay the price.
Specifics: We did send information (tax documents, etc.) but never signed a contract. We were given a contract, but on reviewing the costs outlined in that contract we decided not to progress with the loan. Therefore we never signed, and never returned it.
Do you mean you didn't sign the sales contract or that you didn't sign the lock-in agreement with the broker because you didn't like the costs on the good faith estimate?
Neither. I have never signed any documents for the broker. No contract, no agreement. All of our contact was over the phone. We hadn't even settled on a loan.
It the OP never signed a contract or gave the go ahead, he is not obligated to pay for an appraisal. I don't care if 3 appraisals were done, the OP is not the one that owes the money. FWIW, I never order an appraisal without having a check or credit card number in the file for the appraisal. You get stiffed for one appraisal fee, you'll never make that mistake again. If the broker made a unilateral decision, he's paying a unilateral bill. Go check your emails that support what you have said and print them out in case this topic is revisited again.
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