***NOTE: this is a State of California case. Please reply only
if you can provide specific instructions - not just the reference links.***
In a recent "refinance rush" last September I refinanced my purchase
loan within one month after closing. The broker promised me that the
new loan would not have any prepayment penalty. However, during the
final document signing, the notary public pointed out to me that there
was a rider providing for a prepayment penalty within the first 3
years (the loan is 5-year fixed, 1-year adjustable after that). After
signing the papers I was aware of a 3 days right of recission, so I
approached the broker with my worries and the intent to go ahead and
cancel the transaction. The broker reassured me once again that "they
ordered the no-penalty loan" from the bank so there was no reason to
worry. A couple of months later I did receive the letter from the bank
confirming that there indeed was a "soft prepayment penalty" of nearly
$9,000 should I decide to re-fi within the first 3 years. The broker
reaction was pretty much - "oops!". I also consulted an unbiased
lawyer (if there is such a thing?) who said that it was solely my
responsibility to review the papers before signing them and that if I
went to a small claims court, I would have to prove that I did loose
money before trying to sue the broker for negligence. But then there
would be no guarantee I could recover any of it. So, my question is -
considering my stupidity in signing the loan docs without carefully
reading them, how do I (partially?) recover my potential losses or
refinance my current loan WITHOUT paying the penalty? I realize that I
could file a complaint with California Dept. of Real Estate against
the mortgage broker company, or with BBB but would it help me get some
compensation for the "bait-and-switch" or predatory lending action?

I can tell you that in Alberta (Canada) you would be SOL. You signed a
document at a notary, where, by your OWN admission, the payout penalty
was told to you. You signed anyways. Sorry.

Legolas-ga

In no sensible legal system can you "recover potential losses" 
    
 Now, in California,

 where one can sue a restaurant for over-eating, 
 or sue manufacturer for enabling one to smoke,
....
 many things are possible..

 May  be you can break a new legal ground by suing to recover damage 
 which MAY happen in the future.

 There are unlimited possibilities - whole new lucrative field of law....

  More conventional strategy would  be to sue for 'pain and suffering'
 and use as evidence of distress fact you spend $10 on google answers ....