Mortgage loan not going well, please advise!?

My ex is keeping our house, and was told by the bank that he could not refinance the 1st and 2nd (18k) loans solely under his name until we were officially divorced. We (well, he, but I’m helping) continued the process, the house didn’t appraise for the amount we had hoped for (actually, the first loan rep we spoke to suggested putting it at almost $ 40k more than we originally paid for in 2006).

Due to his now single income, we were told he could not refinance both loans under his name. The 1st one would be refinanced, but the second one, the bank would subordinate (still keeping me in the 2nd one). We were reassured all was well, we just needed to be divorced (finalized last week), and then we could set up the closing date.

Now, 10 business days prior to the locked-in rate expires, we are being told that the 2nd loan cannot be subordinated, so he has to bring “around” $ 16,000 to the closing or they cannot proceed. I’m thinking they knew this all along, and I had a bad feeling when the loan processor was avoiding answering my questions on the actual closing date, and when my ex should start paying directly to this lender (as opposed to Chase, with which we still have the 2 loans)…

Is this, then, a form of bait & switch, or plain bad business?

Orange County Sheriff: Hi, actually, we had had the appraisal done in July, so all the information was already in. The loan processor had also said we just needed to get the divorce decree, and then proceed with the closing.

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