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CFPB solicits closing horror tales

By Polyana da Costa ·
Tuesday, January 7, 2014
Posted: 2 pm ET

If you've ever closed on a mortgage, you know that the only thing that's fun about the whole process is the end, when you are handed the keys to your new place.

The CFPB wants to hear about your mortgage-closing horror stories. Photo by Trostle on Flickr

The Consumer Financial Protection Bureau wants to hear about your mortgage-closing horror stories.
Photo by Trostle on Flickr

Certain surprises -- such as last-minute document requests from the lender or discrepancies in numbers -- can turn closing day into a nightmare for some buyers. I've been there.

Welcome to my nightmare

When I bought my house a few years ago, the lender called me three hours before closing, while I was in the middle of packing, to demand additional documents. My loan officer told me that if the underwriting department didn't review and approve the "missing documents" right away, my loan wouldn't close that day, which would have caused my deal to fall through.

To make things more exciting, I didn't have Internet connection that day. I was frantic and furious, but I knew that if I wanted that house, I had to comply with the lender's request quickly. I drove to the nearest coffee shop and emailed the documents to the lender. Two hours and some tears later, my loan file was finally good to go, and I closed.

Poking for pain points

"Why does closing day have to be so stressful?" buyers often ask me. I don't know. But the Consumer Financial Protection Bureau will try to find the answer.

The watchdog agency has asked consumers to share their mortgage-closing experiences with the CFPB. Specifically, the CFPB wants to hear about "pain points" associated with mortgage closing, and for suggestions on how those problems might be solved through technology.

In other words...

The agency says it wants to understand what consumers find most problematic about closing to identify ways to make the closing process more streamlined and efficient.

How to report your painful experience

You have until Feb. 7 to share your nightmarish closing with the CFPB. You can leave your comment here or mail it to: Monica Jackson, Office of the Executive Secretary, Consumer Financial Protection Bureau, 1700 G St. N.W., Washington, D.C. 20552.

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January 07, 2014 at 9:07 pm

99% of the last minute problems are because of government regulations preventing the lender from closing efficiently. It will be very interesting to see what the CFPB discovers in their investigations. I'm sure they will see that it is the government regulations themselves that is the root cause. By the way, bringing an attorney into the process who is not very experienced in real estate closings is a waste of money and creates additional stress. There are mind boggling laws on the books now on closing mortgages and it is impossible for your average attorney to be up to date on all of those laws that lenders must comply with.

January 07, 2014 at 8:57 pm

The last closing we had was a double on the same day. First selling our house and then a few hours later, purchasing our current house. In the middle of the first closing, the buyer's attorney looks at me and asks "City water and sewer, correct?" I said,"No, city water and septic. Why?" He then states we have a problem because no one has tested the septic tank and field. My realtor called the guy who tested it when we purchased the house. His report - affluent levels are high, it fails. Funny, that's exactly what he reported when we were purchasing it but he backed it up by saying the house was vacant for over a year, so we purchased it. Long story short, we had to replace the septic tank and field (about $13,000 in 1996 dollars) consequently wiping out all our money we were going to use on the house we now live in.

January 07, 2014 at 7:35 pm

We had a double closing set, we were closing on the house we sold and the house we were purchasing on the same day. Well the day before closing we were informed that the proper appraisal was not conducted on the house we were selling, they had the appraisal for 5 weeks and the day before closing they choose to tell us they needed a new appraisal... Thanks to our realtor, we got an appraiser out that day and he faxed the appraisal to the loan company & could go ahead with our closing. We could not understand why it took them 5 weeks to figure out the appraisal was not the correct type! All worked out, but to much stress...

January 07, 2014 at 5:13 pm

We've never had a closing problem and here's the reason why. For each of our 2 home purchases, we had an attorney representing us at the closing. The attorney reviewed all the documents, dealt with the lender's attorney as needed, made sure the documents were correct and that they represented what we were told to be the terms of the mortgages. We hired the attorney and paid the costs. The money was well worth it. We did a "simple refi" once and allowed our attorney to also work as the lender's attorney. It was an attorney that we previously used, so we were reasonable confident that the process would go smoothly, and it did.