This is not illegal, because those fees are technically available in the state from some hypothetical settlement services provider that you could hypothetically use (if you were hypothetically an idiot).And you see a nice sexy bottom line number that you find appealing, and pick your lender based in part on "lowest fees," as you did.Then, a week or two into escrow, the lender "discovers" the actual title/escrow fees (they naturally don't even bother asking for them until it's too late for you to switch lenders, and the appraisal is done, etc, because they don't **want** to discover the actual fees juuust yet).Because they quoted you "real" title/escrow fees upfront, and because a full thorough audit will reveal that the lender did not "discover" the actual fees until a day or two prior to you receiving the "updated" disclosure, no law has been broken and this is a lawful practice.I personally go the other way, and quote the most expensive title/escrow fees in my market for purchase transactions.

I have a question about the appropriate amount of information that should be revealed in an ad regarding the credit scores and exposed incomes requirements we seek.

I found the following definition of bait and switch on wikipedia: "In retail sales, a bait and switch is a form of fraud in which the party putting forth the fraud lures in customers by advertising a product or service at an unprofitably low price, then reveals to potential customers that the advertised good is not available but that a substitute is."

If your inspection reveals problems, and they cause the deal to not work, then don't do the deal and use your escape clause to get out.

An inquiry to the city revealed it's a 2 Family.

Or as you do a post mortem on how this "happened", you may see how some extra efforts or clues might have given you more information or even revealed some red flag.Bright side, this may be your worst tenant experience in your landlord career and you are already getting it out of the way....Best of luck.

It is totally unethical on top of that to reveal what should be kept confidential that creates such a disadvantage for the client. 

Each step you take reveals a new horizon.

For many different reasons.....some people will leave the industry, others will change their business model/goals, you may change your model/goals, true colors are revealed over time, and the list goes on.

Those items will reveal for the lender the ability of the borrower (and property) to have the income to service all debts of the borrower.