Final settlement statement $8000.00 differance

[gingin4u2]

What is the name of your state?California
We refinanced our home to pay off a line of credit that was in default. After negotiating with that bank we were to take out $40,000.00 from the refi to clear the debt. When I picked up the check it was $8000.00 short. It appears our 1st had a prepayment penalty that we did not know about but that would have ended in 3 months. Had we been told we would have put off the refi for 3 months. Since it recorded we are now short to clear the debt. The broker and escrow company have agreed to cover 1500.00 of the cost. Pointing fingers at eachother we are still short and at a loss. The escrow company knew of the prepayment penalty for 2 weeks and didn't notify anyone. Can we do anything?

 

[I AM ALWAYS LIABLE]

What is the name of your state?California
We refinanced our home to pay off a line of credit that was in default. After negotiating with that bank we were to take out $40,000.00 from the refi to clear the debt. When I picked up the check it was $8000.00 short. It appears our 1st had a prepayment penalty that we did not know about but that would have ended in 3 months. Had we been told we would have put off the refi for 3 months. Since it recorded we are now short to clear the debt. The broker and escrow company have agreed to cover 1500.00 of the cost. Pointing fingers at eachother we are still short and at a loss. The escrow company knew of the prepayment penalty for 2 weeks and didn't notify anyone. Can we do anything?

My response:

Actually, no. You see, the penalty was all spelled out in your original mortgage contract. You had a duty to read and understand your own contract. While it would have been "nice" for everyone to tell you what you already knew, they had no responsibility to stop the refinance done at your request and insistence.

In other words, had you read your own contract, you could have put the brakes on the refinance yourself. Do not blame someone else for their failure to hand-hold you. It doesn't always happen in life, and other people are not paid to "look out" for you.

IAAL

 

[herkxena]

Check the prepayment penalties listed in your note and the pre-payment rider that was recorded with the deed of trust.

My parents had a 5 year prepayment penalty on their note but a 2 year prepayment penalty in the rider that was filed with the deed of trust. The rider recorded with the deed of trust stated that the rider invalidated any other prepayment clause.