Mortgage balloon rider has been altered

Hi all!

New to this forum!

We are in a mess. After refinancing our loan in 2006 and signing our loan docs in our house, not in an office, it would appear we are in trouble.

Our loan clearly states a 30-year adjustable maturing in 2036; unfortunately, the balloon rider at the end, which readjusts in 2008, with adjustments every 6 months thereafter, has been altered. The rider says 50 years amortization with all unpaid interest and principal due at majurity. We have a conflict here! Not to mention a huge interest penalty if we refinance or sell our home. We never saw this small alteration to 50 years that has obviously been whited-out and changed.

Do we have legal recourse? I would think so given the loan says 30 years and the rider has been secretly changed to 50.

I hope someone can lead us in the right direction.

IF it was changed before we signed -- may I add the "50" was craftfully altered (whited out) so that, unless you read every darn word, you'd miss the tiny "50" -- do we have any recourse? How can 50 years and 30 years show up on the same mortgage and still be legit??? It clearly states the 2036 maturity date on the second page of the doc.

Something is wrong. This mortgage can't be 30 and 50 years simultaneously!

The loan officer ran off to another state and began an internet get-rich-quick scam.

I would strongly suggest you contact the mortgage company you are making your payments to as soon as possible via telephone and inform them of the discrepancy you've noted. I'd also follow this up with a written notification along with a copy of the mortgage you have. Is your copy of the mortgage a recorded copy? One would be available from the title company who closed your loan (they'd have to request a copy from the recorder's office) or you can obtain a recorded copy yourself directly from the county recorder's office where the loan was closed. That mortgage will specify the maturity and yes, you're right, if the date was/is 2036, you're looking at a standard 30 yr adjustable. These closing documents are required to be recorded within a certain timeframe after closing, depending on your state.

You also need to check your state's real estate laws to determine if you live in a 'pre-payment penalty' state. There are a few states left which are 'no prepayment' penalty states; be sure to check yours. It may be irrelevant if in fact you do reside in a state that does not allow for a prepayment penalty if you pay the loan off early. Which state do you live in?

Your most important documents here are the note and mortgage. Get recorded copies of both; examine both carefully. They should be identical in dates originated, mortgage amount and dates of maturity. In answer to your questions, YES, it is illegal to alter any of those documents without having the borrower initial and date any changes .. and yes, it IS unethical, to say the least. Mortgage lenders can NOT "bait and switch" program types or terms of the loans without prior acknowledgement from the borrower (in writing); that's precisely what Anti-Predatory laws were designed to prevent. If you're the least bit concerned about the authenticity of the documents you have, I'd strongly suggest you obtain recorded copies I've indicated above and have a good real estate attorney review everything. With any luck, yours is simply a "clerical error" (not very likely) or at the very least, a strange sense of carelessness and lack of experience (more probable.) I'd be curious to know (in English) why the mortgage company included a "balloon" rider and not a standard Adjustable Rate Mortgage Rider .. you may want to ask why that particular closing document was used. Where is your ARM rider? Do you have a recorded copy?

At the very least, corporate headquarters of the company where you make your payments needs to be aware of what you've discovered. A new mortgage should be prepared, signed/dated, and re-recorded with the county, should this also appear on the recorded copies you'll have obtained. You have the right to insist on this.

Assuming worst case scenario: If the documents have been altered (without your initial/date) to a loan term you never agreed to and you find yourself bound to something you've never heard of, contact your mortgage company immediately with legal counsel. If it turns out you've been deceived from the beginning (and that will be apparent in the preliminary paperwork you received at the beginning of your mortgage application,) and if your mortgage company refuses to investigate it, you have full recourse through your local state attorney general's office. Before you do that, have your attorney make absolutely certain you're right before you contact them.

Does this help?

Thank you!! It does help greatly.

The copy I obtained today is indeed a recorded copy from the recorder's office here in Reno, Nevada. Page two of this document does say June 26, 2006 as the date of the promissory note, with the loan to be paid no later than July 1, 2036.

The only box that is checked is "other," Balloon ARM Rider. This is the only rider on the mortgage.

We can't recall if the rider was altered before or after we initialed/dated the pages. The "50" is very small and it is quite obvious a change was made; in fact, the font doesn't match the document font.

Once again, I'd suggest the rider be corrected and re-recorded. Your loan will probably be sold to more than one servicing lenders in the future and it'll just save aggravation in the future. You're probably already aware of the information on the following 2 links; I'm posting them as an FYI .. you can compare this information against your own closing docs. You may want to double-check the mortgage note and mortgage itself to make sure no alterations appear elsewhere as well. Again, good luck.

http://www.legalmatch.com/law-librar...mortgages.html

http://www.legalmatch.com/law-librar...ment-tila.html

Thank you! We are in for a wild ride (pun intended!).

I'll provide an update in the weeks ahead to let you know how fast this is corrected.

And, we see no other alterations... thank goodness!

I became a member day before yesterday and tried to reply to your situation. For some reason once I registered the system would not allow me to reply but it did allow me to send you a private message.

Please check your private messages folder and hopefully my suggestion will help you out.

Please let me know you've received the message. Just tryin' to help out.