I recently purchased my dad's house. We had a large and sudden addition to our family and he couldn't afford the payment/upkeep and didn't need the space anymore. We went to a large bank because he was very happy with how they reworked his mortgage to save the house a few years back. The banker wrote up and filled out the contract for us. He listed the sale price as $100,000 and I applied for an $80,000 loan. My dad owed around 75k on 2 mortgages and I specifically told the man I wanted to take out a little more to do some immediate work. The banker said that was pretty typical and wouldnt be a problem. My down payment was going to come from a gift of equity in the house. We all verbally agreed I would pay closing costs. Aftering out the contract we were told we would have fast closing and "very minimal to no closing cost". He also agreed to look into programs for us. I am a first time buyer, recent college grad and a teacher. The house appraised for roughly 120k and things went smoothly up until the week before closing. I was originally told from the processor it would be 21k cash to close, including a 20k gift of equity as down payment. I got a call from the title company the Monday before closing that cash to close was $285. 2 days later I get another call that may dad was going to owe $2700 cash for his portion of closing after everything was paid off. I begrudgingly paid that and we closed. I asked today about the difference in what my dad owed and what I borrowed and when I will get that. The original guy we met with had no idea and when he got back to me told me it was applied as a down payment. I asked for what and he said the 100k purchase price. At this point I am excessively frustrated. His response to the closing cost was he must not have calculated something right originally and he is done writing contracts because doesn't understand them. How can money I borrow be applied to the purchase? What is it paying down? How does contract law apply in this situation. Should have known better but I had a decent rate so I didn't shop around because of the fast closing with little or no cost. I also fully expected to get a few thousand back when we closed or I wouldn't have taken the extra out. I am going to call his supervisor tomorrow. Anything ammo I should be loaded with? Tyia

-Update
I contacted a large mortgage company to ask for a review or advice. The lady I spoke with the entire deal sounds bad and she highly recommended getting a contract attorney and going from there. After speaking with a CSR at the bank, they told me to file a complaint. Finally get a response today from the original LO. He tells me we probably had a miscommunication during our first meeting and he is no longer going to write contracts and going to look into things. 
He has also told me that the additional money I borrowed(around 5k) went to additional closing cost. Which puts the total for closing now at roughly $8,500. Pretty far off base from minimal closing. He is supposed to look into things and get back to me but I have a feeling its still not going to be satisfactory. 

Also, does anyone have experience doing a quick quit deed with a refinance? The woman I spoke with at the mortgage company said this would have been the easiest and cheapest way to go. Thank you!

And I apologize to those I said I would contact. I changed school districts and we started extended school week and I quickly got overwhelmed. Thank you!