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WiseOwl58, Lawyer
Category: Real Estate Law
Satisfied Customers: 3677
Experience:  Experienced real estate lawyer and real estate broker.
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I just realized that my loan officer used my 20% down on my

Customer Question

I just realized that my loan officer used my 20% down on my house to pay other charges and fees related to closing costs. As a result i am paying PMI which is what I told him that I did not want to do. The purpose for paying the 20% was for avoiding PMI on FHA loan. Is this legal? Am I missing something.
Submitted: 2 years ago.
Category: Real Estate Law
Expert:  WiseOwl58 replied 2 years ago.
They are entitled under contract to take the fees and costs first, before applying it to principal. That being said, you may be able to pay a little bit more, say up it to 21% or 22% so that you cover 20% of the principal and are not required to pay the PMI. Good luck to you. I wish you all the best.
Customer: replied 2 years ago.

The point is he never asked me for more money and due to that I have to pay pmi. He was clearly told that many times. Because he used my money for other things it put me slightly under do i have legal recourse

Expert:  WiseOwl58 replied 2 years ago.
Yes, you do have a claim and you are not responsible for paying PMI under Georgia law. In these circumstances, you should first contact the legal department of the bank and tell them to remedy the situation and refund any PMI insurance premiums that you have paid to date, Cathy. Tell them that you have consulted with a real estate lawyer. If they are not willing to do that, your next step is to file a complaint with the Georgia State Banking Commission which is their regulator, and they will surely respond to such complaint.

Here is the link to file the complaint if it come to that:

Please rate the answer 4 or 5 and close out the question. Thanks and good luck to you, Cathy.

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