2006
A few months ago I refinanced my house. Financing, or refinancing, a mortgage, is something a lot of you out there have done at least once in your life. Nowadays, we’re talking about taking on a debt in the hundreds of thousands of dollars, certainly not a debt to be taken lightly. Yet how many of you, at your closings, actually took the time to read – not just the fine print – but even the large print of every document you signed or initialed?
I know I never have. By my reckoning, this was the sixth time I had gone through a closing. At every one of them I was determined to carefully read every document thrust in front of me because that’s what we’ve been taught: Never sign anything before reading it thoroughly. And it’s always a good idea to have your own attorney present. The first time I bought a house, I did have an attorney representing my interests. But he didn’t read anything either. “It’s all a formality,” he’d say, or something along those lines. “Go ahead and sign.”
The problem is not a lack of ambition. The problem is a lack of time. Real estate attorneys are always in a rush to get to the next closing, and since they’re already late for yours, they never give you nearly enough time to read anything. The guy I dealt with at my last closing was actually a day late, and then nearly an hour late again when he showed up, huffing and puffing, at my door the following day. Like the March hare in “Alice in Wonderland,” he said he was late for another very important date and hoped we could get through the two stacks of documents in less than 45 minutes.
There were 105 pieces of paper in each stack. I didn’t even have time to count them then, much less read them. It would have been easier – and faster – to read the collected works of Charles Dickens than it would have been to read the legalese on all those documents.
So I did what I always did. I signed and initialed where he told me, one copy of each document for me and one for the finance company, as rapidly as I could. I felt like one of those ballplayers at a baseball card show who gets ten grand to sign his name two thousand times in two hours, although I wasn’t getting ten grand to do it. It was going to cost me a hundred grand, plus interest, for the next fifteen years. And that’s only if every document I was furiously signing and initialing was exactly what I was being told it was. If they weren’t, I could be out a lot of money and without a house. In a nation where we have learned the hard way to distrust peddlers, priests, and politicians, it’s amazing how much trust we put in someone we’ve never met who’s asking us to risk hundreds of thousands of dollars by signing documents we don’t even bother to read.
So now, several months later, I’ve decided to read those documents I signed. And I’ve got to tell you, there’s some amazing stuff in there.
How about this one: “In connection with your application for a home loan, the lender must disclose to you the score that a consumer reporting agency distributed to users and the lender used in connection with your home loan, and the key factors affecting your credit scores. The score is Red Sox 8, Yankees 3.”
Or how about this? “These estimates are provided pursuant to the Real Estate Settlement Procedure Act of 1974, as amended. Additional information can be found in the HUD Special Information Booklet, which is to be provided to you by your mortgage broker or lender. If this booklet does not have a cover, you should be aware that this booklet is stolen property. It was reported as unsold and destroyed to the publisher and neither the author nor the publisher has received any payment for this stripped booklet.”
Then there’s this passage: “I and any other person who has obligations under this Note waive the rights of Presentment and Notice of Dishonor. Honor thy mother and thy father. Thou shalt not kill. I shall not pass Go and collect $200.”
And this one: “Words used in multiple sections of this document are defined below and other words are defined in Sections 3, 11, 13, 18, 20 and 21. Certain rules regarding the usage of words in this document can be found in the McGraw-Hill Handbook of English, copyright 1952. Words that do not appear in the Merriam-Webster English Dictionary, abridged version, copyright 1947, have no meaning.”
This one blew me away: “Borrower does hereby mortgage, grant, and convey to the lender the following described property, together with all the improvements now or hereafter erected on the property, and all easements, appurtenances, and fixtures now or hereafter a part of the property. A minister, a priest, and a rabbi walk into a bar …” Well, I can’t repeat the rest of that on the air unless I was Howard Stern.
I also found this passage: “Borrower shall pay all taxes, assessments, charges, fines, and impositions attributable to the property which can attain priority over this security instrument, leasehold payments, or ground rents on the property, if any. You and I travel to the beat of a different drum. Can’t you tell by the way I run. Every time you make eyes at me, Wo-oh.”
Don’t ask me how this one got in. “Borrower shall be in default if any action or proceeding, whether civil or criminal, is begun that, in Lender’s judgment, could result in forfeiture of the property. For a good time, call Jill at 555-9734. Borrower can cure such a default and reinstate as provided in Section 19.”
On and on and on it goes, for 105 interminable, blinding pages. Now that I’ve finally read them and know what’s in them, next time I’ll wait for the movie.