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By TIM GRANT
© St. Petersburg Times, published May 27, 2001
The Department of Housing and Urban Development last week released four reviews the agency conducted last year on scores of home loans issued in several regions of the country by GreatStone Mortgage of Tampa. The reviews said the federal agency found a variety of problems, including:
Loans based on credit reports that were as much as 204 days old or did not include the borrower's name.
Excessive fees. One borrower was charged $725 for a home appraisal when the local rate averaged $325. Another was charged $125 for document preparation by GreatStone even though such fees are permitted only when the work is done by an outside company. Other improper fees were levied for items such as surveys and overnight delivery.
Excessive points tacked onto a mortgage. In the cases HUD reviewed, customers were charged up to seven points. Each point is 1 percent of the loan amount.
Loan amounts that exceeded the regulatory maximum.
Delinquent interest, late charges and fees being refinanced into new HUD/FHA loans even though that is prohibited.
New mortgages that exceeded the original principal balance with no assurance of good credit.
The principal and interest payment in new loans increased, instead of decreasing, without a shortened term or change in the mortgage type.
In 35 cases, a Good Faith Estimate of Settlement Costs was not provided to applicants during the required time frame.
Executives at GreatStone Mortgage did not respond to requests for comment.