Huntington Bank Bait & Switch on Loan

[Matthew John]

I am in the process of closing on an owner occupied Duplex. I shopped around 3 different lenders and here were their offers...(ALL CONVENTIONAL LOANS) Summit Funding - 5% down, 5.75% interest rate, I pay closing costs Bank of England - 15% down, 5.45% interest rate, I pay closing costs Huntington Bank - 3% down, 4.75% interest rate, they pay closing cost since we qualify for Home Ready Buyer program (had to take a course) Based on these terms, it's a NO BRAINER who to pick, right? We decided to go with Huntington even though both of the other lenders said they will "tell you whatever you want to get you in the door, then switch it up last minute". We just had our Appraisal go through with Huntington today & got an email saying "I just got word that 15% down payment will be needed for this property" I specifically asked Huntington if this 3% down conventional loan was going to be ok because other lenders said it was impossible through the Home Ready program. She assured me this was & they get the best rates since they're a large bank. The Bank of England sent me this link saying it was impossible to do a 3% down loan on a Duplex - https://www.fanniemae.com/content/fact_sheet/homeready-product-matrix.pdf My question is, what are my options? Are there any other programs or options on getting an owner occupied Duplex for 3% or even 5% down (while avoiding closing costs)? Is this "bait and switch" type situation common with big banks?

[Chris Mason]

Originally posted by @Matthew John:

@Jeff Dulla That link didn't work, but I agree. I don't want to give this lender the reward when they clearly fail at their job. 

It's hard to beat the interest rate + offering to pay closing costs, though. 

This is going to be a very blunt "Come to Jesus" post, if your skin is feeling thin today then please stop reading here.

 I can "offer" you 0% down and 0% for the interest rate... but guess what? It ain't gonna actually close. 

The LO at Summit Funding (a competitor of mine btw) is the only lender you've so far spoken with (aside from on this forum) that told you what you "need to hear," not some bullsnizzle about what you "want to hear," that was balanced with an actual deliverable. If you want the home, call him back. It's really that simple -- and for what it's worth I'm endorsing my competition here. The BS rate/terms you were quoted that brought you to H Bank aren't going to happen, period, end of story, done.

It's usually the case that you are best served by working with the most knowledgeable local lender who can communicate clearly, and not any of the 600,000 technically licensed/registered smoke blowers (yup, really, at this point 0.5% of the US Population have an NMLS or NMLSR, which is freaking insane) that have been doing refis only for the last 5 years (until rates just went up) who don't know how to read a purchase contract or do a purchase mortgage (most of these refi jockeys will be out of the industry within a year or so, once they are done grasping at straws and promising non-deliverables to homebuyers). This is an example of that. 

Markets shift, the refi jockeys are prowling, and they mostly have no clue in the world what they are doing.