Countrywide Home Loan's Full Spectrum Lending division is a disgrace to an increasingly disgusting mortgage business.
Last April, my wife and I decided to refinance our home. So, we made a few calls and settled on Countrywide's Full Spectrum Lending because we liked the agent we dealt with. His name was John Donaghue, and he suggested getting an interest only loan because we were only staying in our house another year or two and we wouldn't be paying off much principal balance anyway. This way we could save more money. I checked into it, and he was right - the money we could save by paying off an interest only payment was dramatically higher than the money we could save paying off a 30-year fixed.
So, we went with it. John Donaghue was able to lower our monthly payment by an astonishing $500 a month! We were so happy! So, we signed the paper work.
Imagine my surprise four months later when we looked at our principal balance and it was FOUR THOUSAND DOLLARS MORE than what it was after refinancing.
Now, I admit, we did not thoroughly examine the contracts. And that is a mistake we will NEVER make again. Because if we had thoroughly read the contract, we would have seen that the reason our payment was so low was because John Donaghue roped us into a negative amoritization loan. Which basically means that we pay only PARTIAL interest and the rest of the interest is getting added to our principal balance every month.
So, we were saving $500 a month in payments, but $600 a month was being added to our principal balance! I admit, we should have picked that up when signing the contract, but shouldn't Mr. Donaghue have TOLD US THAT WHEN HE WAS TELLING US ABOUT THE DAMN CONTRACT?!?!?!? What kind of company allows their sales force to do that kind of crap?
So, we had to refinance again. We're back to where we started and have had to pay closing costs twice in the past year. Not good times.
I wish the story ended there. But, on Christmas Eve we found out that our new mortgage company (Allied Home Mortgage) had sold our mortgage to another firm. Take a wild guess who they sold it to!
You guessed it - COUNTRYWIDE!
So, now we're dealing with this deceitful company again and we have no recourse, but to bend over and take it from them. (Not unless we want to refinance yet again)
To make a long story short, Countrywide Home Loans and Full Spectrum Lending are two companies that you should avoid at all costs.