Can lender charge for a loan application?

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stillConfused_IHB

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We recently applied for a mortgage loan with Bank of America and Union Bank of California.





Bank of America did not charge us to take the application, but Union bank of California charged us $375 for the mortgage application fee and basically told us that they will credit this amount at the closing. Less than two days after we applied for the loan, we asked them not to process it any further as we were going with Bank of America (where we have a relationship for long time).





They had not done anything other than taking application over the phone and asked us to supply the documents supporting the loan which we had provided. The file did not even go to underwriter or loan processor by the time we asked them to stop and when I asked them about the application fee, I was told that the manager would be able to approve the refund. Yesterday they left me a voice mail that the manager did not approve the refund.





Do you think there is any way we can get our application fees back? Can we file a dispute with credit card company after we are done closing the escrow?





Thanks in advance.
 
No, it was all over the phone and nothing was signed. Sorry for the lack of knowledge, but is it a simple process to go to small claims court? I am assuming there are no lawyers involved.
 
Small claims court is fairly simple. No lawyers allowed -- you tell your story to the judge, the other side tells their story to the judge, and the judge rules. Before going that route, you should definitely attempt to get your deposit back by communicating with the manager. They are playing the odds that you're going to not bother trying to get your deposit back, but if you make it clear that you're going to fight for it, they're likely to give it back, rather than having to send someone into small claims court.
 
I'd follow marty's advice to try and work with the lender first, but do it quickly. If they refuse to refund you the $375 within 1-2 days, call your credit company and talk to a customer service rep there for assistance. Good credit card companies will dispute the bill on your behalf. If that doesn't work, then go to small claims court.
 
Or you can get the small claims court paperwork, fill it out, get the envelope addressed and ready to send, and then show it to the manager when you politely ask for your refund, and ask him where the nearest mailbox is.
 
<p>All this is great advice, but really, they should not charge you at all. They should be hustling for YOUR money, not vice versa. Good luck and let us know what happens.</p>

<p>-bix</p>
 
Yes, They issued a credit to my credit card.





All I said to them was: "I may have to file a dispute with my credit card company, since you are charging for a service you have not provided."





Keeping my fingers crossed. We are closing escrow on this Monday....
 
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