Mortgage Loan approval hell

[jpinpb]

[quote=Diego Mamani]Both extremes are wrong.[/quote]
I agree. In fact, punishing someone who has a high credit score b/c the banks screwed up before is really bad business. But it is what it is. I’d rather they double check than turn a blind eye.

[davelj]

[quote=Diego Mamani][quote]These are not “problems” – they are good things. It’s called “proper underwriting”[/quote][quote]had the same experience (…) Both our credits were above 800 + I’ve held the same job for close to 10 yrs.[/quote]

I think that “proper underwriting” would require that lenders be smart about it, and require somewhat less documentation from borrowers with ~800 scores, stable incomes, low LTV, etc.

These “smart” bankers went from lending money freely in NINJA fashion, to now being completely tight and giving everybody, regardless of creditworthiness, a hard time.

Both extremes are wrong.[/quote]

I think what lenders have learned in the recent cycle is that FICO scores and credit reports often lie. That is, all too often they are not good predictors of behavior where repayment of mortgage loans are concerned. How many people, after all, used their “high FICO” scores to buy more house than they could afford and then subsequently “walked away”? Apparently quite a few. So, if you want to blame someone for your underwriting woes, start with Fair Isaac (who designed a flawed product) and then move onto the folks with high FICOs who rendered the scores of dubious value. I’m still not sympathetic. I just don’t think you have a sense of history as to how mortgages were underwritten 15+ years ago. It was quite an ordeal – as it should be.

[davelj]

[quote=Diego Mamani][quote]These are not “problems” – they are good things. It’s called “proper underwriting”[/quote][quote]had the same experience (…) Both our credits were above 800 + I’ve held the same job for close to 10 yrs.[/quote]

I think that “proper underwriting” would require that lenders be smart about it, and require somewhat less documentation from borrowers with ~800 scores, stable incomes, low LTV, etc.

These “smart” bankers went from lending money freely in NINJA fashion, to now being completely tight and giving everybody, regardless of creditworthiness, a hard time.

Both extremes are wrong.[/quote]

I think what lenders have learned in the recent cycle is that FICO scores and credit reports often lie. That is, all too often they are not good predictors of behavior where repayment of mortgage loans are concerned. How many people, after all, used their “high FICO” scores to buy more house than they could afford and then subsequently “walked away”? Apparently quite a few. So, if you want to blame someone for your underwriting woes, start with Fair Isaac (who designed a flawed product) and then move onto the folks with high FICOs who rendered the scores of dubious value. I’m still not sympathetic. I just don’t think you have a sense of history as to how mortgages were underwritten 15+ years ago. It was quite an ordeal – as it should be.

[davelj]

[quote=Diego Mamani][quote]These are not “problems” – they are good things. It’s called “proper underwriting”[/quote][quote]had the same experience (…) Both our credits were above 800 + I’ve held the same job for close to 10 yrs.[/quote]

I think that “proper underwriting” would require that lenders be smart about it, and require somewhat less documentation from borrowers with ~800 scores, stable incomes, low LTV, etc.

These “smart” bankers went from lending money freely in NINJA fashion, to now being completely tight and giving everybody, regardless of creditworthiness, a hard time.

Both extremes are wrong.[/quote]

I think what lenders have learned in the recent cycle is that FICO scores and credit reports often lie. That is, all too often they are not good predictors of behavior where repayment of mortgage loans are concerned. How many people, after all, used their “high FICO” scores to buy more house than they could afford and then subsequently “walked away”? Apparently quite a few. So, if you want to blame someone for your underwriting woes, start with Fair Isaac (who designed a flawed product) and then move onto the folks with high FICOs who rendered the scores of dubious value. I’m still not sympathetic. I just don’t think you have a sense of history as to how mortgages were underwritten 15+ years ago. It was quite an ordeal – as it should be.

[davelj]

[quote=Diego Mamani][quote]These are not “problems” – they are good things. It’s called “proper underwriting”[/quote][quote]had the same experience (…) Both our credits were above 800 + I’ve held the same job for close to 10 yrs.[/quote]

I think that “proper underwriting” would require that lenders be smart about it, and require somewhat less documentation from borrowers with ~800 scores, stable incomes, low LTV, etc.

These “smart” bankers went from lending money freely in NINJA fashion, to now being completely tight and giving everybody, regardless of creditworthiness, a hard time.

Both extremes are wrong.[/quote]

I think what lenders have learned in the recent cycle is that FICO scores and credit reports often lie. That is, all too often they are not good predictors of behavior where repayment of mortgage loans are concerned. How many people, after all, used their “high FICO” scores to buy more house than they could afford and then subsequently “walked away”? Apparently quite a few. So, if you want to blame someone for your underwriting woes, start with Fair Isaac (who designed a flawed product) and then move onto the folks with high FICOs who rendered the scores of dubious value. I’m still not sympathetic. I just don’t think you have a sense of history as to how mortgages were underwritten 15+ years ago. It was quite an ordeal – as it should be.

[davelj]

[quote=Diego Mamani][quote]These are not “problems” – they are good things. It’s called “proper underwriting”[/quote][quote]had the same experience (…) Both our credits were above 800 + I’ve held the same job for close to 10 yrs.[/quote]

I think that “proper underwriting” would require that lenders be smart about it, and require somewhat less documentation from borrowers with ~800 scores, stable incomes, low LTV, etc.

These “smart” bankers went from lending money freely in NINJA fashion, to now being completely tight and giving everybody, regardless of creditworthiness, a hard time.

Both extremes are wrong.[/quote]

I think what lenders have learned in the recent cycle is that FICO scores and credit reports often lie. That is, all too often they are not good predictors of behavior where repayment of mortgage loans are concerned. How many people, after all, used their “high FICO” scores to buy more house than they could afford and then subsequently “walked away”? Apparently quite a few. So, if you want to blame someone for your underwriting woes, start with Fair Isaac (who designed a flawed product) and then move onto the folks with high FICOs who rendered the scores of dubious value. I’m still not sympathetic. I just don’t think you have a sense of history as to how mortgages were underwritten 15+ years ago. It was quite an ordeal – as it should be.

[davelj]

[quote=paramount]
Oh get off your high horse

[img_assist|nid=14709|title=High Horse|desc=|link=node|align=left|width=100|height=75]

[/quote]

No. I rather like my high horse. I’m quite happy atop it at the moment.

[quote=paramount]
And BTW those lenders are way more than likely the American tax payers not some con artist mortgage broker.[/quote]

OK, let’s assume that the lenders are the American tax payers. Are you suggesting that We the People should have less strict underwriting standards than the typical private enterprise? That’s absurd. That’s how We the People ended up with the GSEs. So, contrary to your position, I think that if We the People’s money is at stake, the underwriting standards should be among the highest in the industry. I remain unsympathetic.

Now, I’m off for a ride on my high horse… at a pleasant gallop.

[davelj]

[quote=paramount]
Oh get off your high horse

[img_assist|nid=14709|title=High Horse|desc=|link=node|align=left|width=100|height=75]

[/quote]

No. I rather like my high horse. I’m quite happy atop it at the moment.

[quote=paramount]
And BTW those lenders are way more than likely the American tax payers not some con artist mortgage broker.[/quote]

OK, let’s assume that the lenders are the American tax payers. Are you suggesting that We the People should have less strict underwriting standards than the typical private enterprise? That’s absurd. That’s how We the People ended up with the GSEs. So, contrary to your position, I think that if We the People’s money is at stake, the underwriting standards should be among the highest in the industry. I remain unsympathetic.

Now, I’m off for a ride on my high horse… at a pleasant gallop.

[davelj]

[quote=paramount]
Oh get off your high horse

[img_assist|nid=14709|title=High Horse|desc=|link=node|align=left|width=100|height=75]

[/quote]

No. I rather like my high horse. I’m quite happy atop it at the moment.

[quote=paramount]
And BTW those lenders are way more than likely the American tax payers not some con artist mortgage broker.[/quote]

OK, let’s assume that the lenders are the American tax payers. Are you suggesting that We the People should have less strict underwriting standards than the typical private enterprise? That’s absurd. That’s how We the People ended up with the GSEs. So, contrary to your position, I think that if We the People’s money is at stake, the underwriting standards should be among the highest in the industry. I remain unsympathetic.

Now, I’m off for a ride on my high horse… at a pleasant gallop.

[davelj]

[quote=paramount]
Oh get off your high horse

[img_assist|nid=14709|title=High Horse|desc=|link=node|align=left|width=100|height=75]

[/quote]

No. I rather like my high horse. I’m quite happy atop it at the moment.

[quote=paramount]
And BTW those lenders are way more than likely the American tax payers not some con artist mortgage broker.[/quote]

OK, let’s assume that the lenders are the American tax payers. Are you suggesting that We the People should have less strict underwriting standards than the typical private enterprise? That’s absurd. That’s how We the People ended up with the GSEs. So, contrary to your position, I think that if We the People’s money is at stake, the underwriting standards should be among the highest in the industry. I remain unsympathetic.

Now, I’m off for a ride on my high horse… at a pleasant gallop.

[davelj]

[quote=paramount]
Oh get off your high horse

[img_assist|nid=14709|title=High Horse|desc=|link=node|align=left|width=100|height=75]

[/quote]

No. I rather like my high horse. I’m quite happy atop it at the moment.

[quote=paramount]
And BTW those lenders are way more than likely the American tax payers not some con artist mortgage broker.[/quote]

OK, let’s assume that the lenders are the American tax payers. Are you suggesting that We the People should have less strict underwriting standards than the typical private enterprise? That’s absurd. That’s how We the People ended up with the GSEs. So, contrary to your position, I think that if We the People’s money is at stake, the underwriting standards should be among the highest in the industry. I remain unsympathetic.

Now, I’m off for a ride on my high horse… at a pleasant gallop.

[paramount]

I thought you’d like that high horse…

Anyway, here’s the deal and something I have learned recently.

First of all – home ownership is good for America. It’s what builds communities and identities. It’s good for the economy. It gives people and families something to strive for – and it’s worth striving for.

Allow me to relate (2) recent experiences:

1. In January I decided to look for a rental house in San Diego to be closer to work. In going through this process I (IMO) encountered some really unpleasant people in the property management business.

Experiences like that help one appreciate home ownership (even if you are renting it from the bank).

2. 10 years ago the community I live in was primarily owner occupied. Fast forward 10 years and now our community is primarily renter occupied and there is much less of a sense of community IMO. No more block parties, U-Haul trucks appearing weekly – very transient.

We have to take calculated risks. For buyers with strong credit profiles, 10% down and good ratios I think that’s a risk worth taking given the benefit to the buyers and the community.

[paramount]

I thought you’d like that high horse…

Anyway, here’s the deal and something I have learned recently.

First of all – home ownership is good for America. It’s what builds communities and identities. It’s good for the economy. It gives people and families something to strive for – and it’s worth striving for.

Allow me to relate (2) recent experiences:

1. In January I decided to look for a rental house in San Diego to be closer to work. In going through this process I (IMO) encountered some really unpleasant people in the property management business.

Experiences like that help one appreciate home ownership (even if you are renting it from the bank).

2. 10 years ago the community I live in was primarily owner occupied. Fast forward 10 years and now our community is primarily renter occupied and there is much less of a sense of community IMO. No more block parties, U-Haul trucks appearing weekly – very transient.

We have to take calculated risks. For buyers with strong credit profiles, 10% down and good ratios I think that’s a risk worth taking given the benefit to the buyers and the community.

[paramount]

I thought you’d like that high horse…

Anyway, here’s the deal and something I have learned recently.

First of all – home ownership is good for America. It’s what builds communities and identities. It’s good for the economy. It gives people and families something to strive for – and it’s worth striving for.

Allow me to relate (2) recent experiences:

1. In January I decided to look for a rental house in San Diego to be closer to work. In going through this process I (IMO) encountered some really unpleasant people in the property management business.

Experiences like that help one appreciate home ownership (even if you are renting it from the bank).

2. 10 years ago the community I live in was primarily owner occupied. Fast forward 10 years and now our community is primarily renter occupied and there is much less of a sense of community IMO. No more block parties, U-Haul trucks appearing weekly – very transient.

We have to take calculated risks. For buyers with strong credit profiles, 10% down and good ratios I think that’s a risk worth taking given the benefit to the buyers and the community.

[paramount]

I thought you’d like that high horse…

Anyway, here’s the deal and something I have learned recently.

First of all – home ownership is good for America. It’s what builds communities and identities. It’s good for the economy. It gives people and families something to strive for – and it’s worth striving for.

Allow me to relate (2) recent experiences:

1. In January I decided to look for a rental house in San Diego to be closer to work. In going through this process I (IMO) encountered some really unpleasant people in the property management business.

Experiences like that help one appreciate home ownership (even if you are renting it from the bank).

2. 10 years ago the community I live in was primarily owner occupied. Fast forward 10 years and now our community is primarily renter occupied and there is much less of a sense of community IMO. No more block parties, U-Haul trucks appearing weekly – very transient.

We have to take calculated risks. For buyers with strong credit profiles, 10% down and good ratios I think that’s a risk worth taking given the benefit to the buyers and the community.

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