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HLS
ParticipantMichael,
There’s no offense. You aren’t wrong. Rants are therapy for me. I swim with some real scum. I wear a wet suit so they don’t rub off on me.We are all just friends here that haven’t met face to face.
I don’t care if people shop. I can’t promise the lowest price. From what I see though, many people did get screwed on their loans. I can tell from their last closing statement showing the commission that was paid to the broker and the fees that were charged. I don’t need to know what the rates were that day.
Even intelligent, high wage earners got taken. The severity of the neg am loan has yet to rear its ugly head for many. It was pushed by many because it pays the highest commissions in the industry. Horrible product.
Some people pride themselves in thinking that they got the best deal on a car, plumber, computer, suit, loan etc. Does one ever really know ?
Plenty of businesses aren’t cheap, and people know it, and still shop there for quality, service, etc.Is gambling on the internet with the largest financial transaction of one’s life risky ?
Making sure people understand their options and loan is my priority. I’ve heard horror stories of some online loan shopping experiences.I try to explain that you don’t shop for rates, you shop for people to educate you and help you through the process.
ParticipantMichael,
There’s no offense. You aren’t wrong. Rants are therapy for me. I swim with some real scum. I wear a wet suit so they don’t rub off on me.We are all just friends here that haven’t met face to face.
I don’t care if people shop. I can’t promise the lowest price. From what I see though, many people did get screwed on their loans. I can tell from their last closing statement showing the commission that was paid to the broker and the fees that were charged. I don’t need to know what the rates were that day.
Even intelligent, high wage earners got taken. The severity of the neg am loan has yet to rear its ugly head for many. It was pushed by many because it pays the highest commissions in the industry. Horrible product.
Some people pride themselves in thinking that they got the best deal on a car, plumber, computer, suit, loan etc. Does one ever really know ?
Plenty of businesses aren’t cheap, and people know it, and still shop there for quality, service, etc.Is gambling on the internet with the largest financial transaction of one’s life risky ?
Making sure people understand their options and loan is my priority. I’ve heard horror stories of some online loan shopping experiences.I try to explain that you don’t shop for rates, you shop for people to educate you and help you through the process.
ParticipantPCLU 30 YR rates aren’t anything special.
They are fair market rates.
These rates are those extended to our most creditworthy applicants. (???)If that was BY FAR THE BEST DEAL, how much better was it than what you had been quoted ??
Someone try to rip you off ?Rates change every day. Loans still need to be underwritten.
There are fees that need to be covered. You still have to qualify.Their full no cost/no points rate was 6.75% on Friday.
On a $400K loan, That rate would pay a commission to cover all costs, which is $1000-$1500 more than is needed, so that rate isn’t so great.The true par rate was 6.125-6.25 for a full doc loan with a score above 660. (Don’t know what their minimum score criteria is)
If you got the advice and service that you needed, then you should be happy. Some people need help and advice on how to structure the submission so it gets approved.
I doubt that the CU employee can accomplish that, if needed.ParticipantPCLU 30 YR rates aren’t anything special.
They are fair market rates.
These rates are those extended to our most creditworthy applicants. (???)If that was BY FAR THE BEST DEAL, how much better was it than what you had been quoted ??
Someone try to rip you off ?Rates change every day. Loans still need to be underwritten.
There are fees that need to be covered. You still have to qualify.Their full no cost/no points rate was 6.75% on Friday.
On a $400K loan, That rate would pay a commission to cover all costs, which is $1000-$1500 more than is needed, so that rate isn’t so great.The true par rate was 6.125-6.25 for a full doc loan with a score above 660. (Don’t know what their minimum score criteria is)
If you got the advice and service that you needed, then you should be happy. Some people need help and advice on how to structure the submission so it gets approved.
I doubt that the CU employee can accomplish that, if needed.ParticipantMichael,
We aren’t all the same, sorry
I am in the industry and will not disagree with part of what you say.
In ANY commission based industry, any product, commissions breed fraud.There were plenty of morons doing loans that screwed people beyond even your wildest dreams. The borrowers were taken, hook line and sinker. There are fewer still doing that today, but they are still out there. Often it was from a relative, friend or neighbor. I am not going to defend them in any way. Some people are losing their houses today because of the loans that they are in.
To me, providing a mortgage is a service. YOU may know what you want or at least think that you know what you want. Many that stand to make money from a borrower may know less than they do, but they know where their commission comes from.
I give people the best rates that I can and tell people what my service is going to cost them. I don’t care if they want an ARM, interest only, 30 YR or 40 Yr fixed, none of it changes my fee or what I net.
Most people are overwhelmed and stressed out throughout the process. I can solve that. Even if it costs them a few thousand dollars to get straight honest advice about a $500,000 transaction, it is worth it to them. It may not even cost that.
Retail banks have wholesale rates and retail rates. When you walk in a branch, you get retail.
If you are dealing with a scummy loan person, they will add fees to a wholesale rate that can make their prices beyond stupid. When you are deling with someone who is fair, you may easily get a better deal from the broker side.Most people have no clue what they are facing when they are looking for a loan. I will guess that 8 of 10 will try to screw them in some way, either by rate, fees, term etc.
Most succeed.Most borrowers with tough situations were simply turned down by banks, just like the old days. They wanted a loan.
Many major lenders didn’t do subprime loans on the retail side.Having someone who tells you the truth and keeps you out of a prepay when you don’t need to be in one is worth a small fortune. Some people are trusting the largest financial decision of their life to an hourly employee that works for the bank, not for the client, or a young kid in a boiler room with a crappy credit score who has never signed loan docs in their lives and may never.
Personally, I spend more time explaining things than I should. I want people to understand what their options are, so they can decide what is right for them,and it could save them tens of thousands of dollars over the life of their loan, or avoid a pitfall.
I have seen people pay $10,000 or more in prepayment penalties that they should have never been in.YES, I charge for what I do, it’s more than fair in the industry. If someone wants to go at it alone, that’s their choice. I can’t guarantee anyone that I can get them the cheapest rate on earth, but nobody can honestly say that.
I look out for those that work with me.If they care, they will learn something from me too.
I’ve had dozens of rentals and signed more loan docs than most and can give people some help that most others can’t.If you just want to shop rates and think that you have beat the system, maybe you have and maybe you haven’t.
Maybe you are sharper than the average borrower.I’m not even going to ask what you do for a living and how you justify what you get paid for what you do.
I wouldn’t expect to ever get a call from someone with your attitude, and that’s OK with me.I don’t know why I wasted my time writing this, I’m sure that you don’t believe I’m any different.
ParticipantMichael,
We aren’t all the same, sorry
I am in the industry and will not disagree with part of what you say.
In ANY commission based industry, any product, commissions breed fraud.There were plenty of morons doing loans that screwed people beyond even your wildest dreams. The borrowers were taken, hook line and sinker. There are fewer still doing that today, but they are still out there. Often it was from a relative, friend or neighbor. I am not going to defend them in any way. Some people are losing their houses today because of the loans that they are in.
To me, providing a mortgage is a service. YOU may know what you want or at least think that you know what you want. Many that stand to make money from a borrower may know less than they do, but they know where their commission comes from.
I give people the best rates that I can and tell people what my service is going to cost them. I don’t care if they want an ARM, interest only, 30 YR or 40 Yr fixed, none of it changes my fee or what I net.
Most people are overwhelmed and stressed out throughout the process. I can solve that. Even if it costs them a few thousand dollars to get straight honest advice about a $500,000 transaction, it is worth it to them. It may not even cost that.
Retail banks have wholesale rates and retail rates. When you walk in a branch, you get retail.
If you are dealing with a scummy loan person, they will add fees to a wholesale rate that can make their prices beyond stupid. When you are deling with someone who is fair, you may easily get a better deal from the broker side.Most people have no clue what they are facing when they are looking for a loan. I will guess that 8 of 10 will try to screw them in some way, either by rate, fees, term etc.
Most succeed.Most borrowers with tough situations were simply turned down by banks, just like the old days. They wanted a loan.
Many major lenders didn’t do subprime loans on the retail side.Having someone who tells you the truth and keeps you out of a prepay when you don’t need to be in one is worth a small fortune. Some people are trusting the largest financial decision of their life to an hourly employee that works for the bank, not for the client, or a young kid in a boiler room with a crappy credit score who has never signed loan docs in their lives and may never.
Personally, I spend more time explaining things than I should. I want people to understand what their options are, so they can decide what is right for them,and it could save them tens of thousands of dollars over the life of their loan, or avoid a pitfall.
I have seen people pay $10,000 or more in prepayment penalties that they should have never been in.YES, I charge for what I do, it’s more than fair in the industry. If someone wants to go at it alone, that’s their choice. I can’t guarantee anyone that I can get them the cheapest rate on earth, but nobody can honestly say that.
I look out for those that work with me.If they care, they will learn something from me too.
I’ve had dozens of rentals and signed more loan docs than most and can give people some help that most others can’t.If you just want to shop rates and think that you have beat the system, maybe you have and maybe you haven’t.
Maybe you are sharper than the average borrower.I’m not even going to ask what you do for a living and how you justify what you get paid for what you do.
I wouldn’t expect to ever get a call from someone with your attitude, and that’s OK with me.I don’t know why I wasted my time writing this, I’m sure that you don’t believe I’m any different.
ParticipantThis is an unknown. 100 different landlords will have wildly different criteria. I think that foreclosures will be more accepted out of necessity.
If someone has otherwise decent credit, the “system” is going to want them to buy a house again, and will adjust criteria accordingly.
A simple change for FNMA backed loans that a FC is ok will pump life into the market. I expect it to happen eventually.
Things that are shunned today will become acceptable.
Sometimes that’s called progress. In an effort to sell more houses to people that wouldn’t otherwise qualify, it will be a “necessity”The FHA secure program is willing to overlook late payments made AFTER your ARM adjusted. This was unacceptable for a refi in August and before.
Time will tell….
ParticipantThis is an unknown. 100 different landlords will have wildly different criteria. I think that foreclosures will be more accepted out of necessity.
If someone has otherwise decent credit, the “system” is going to want them to buy a house again, and will adjust criteria accordingly.
A simple change for FNMA backed loans that a FC is ok will pump life into the market. I expect it to happen eventually.
Things that are shunned today will become acceptable.
Sometimes that’s called progress. In an effort to sell more houses to people that wouldn’t otherwise qualify, it will be a “necessity”The FHA secure program is willing to overlook late payments made AFTER your ARM adjusted. This was unacceptable for a refi in August and before.
Time will tell….
ParticipantWe are facing economic meltdown. They will print an unlimited number of bills or create the ultimate fund to TRY and stop the tsunami. In the beginning they tried using an umbrella. It didn’t work.
The govts biggest fear right now is a collapse of housing prices. If thousands upon thousands walk away, they cannot burn the houses down, they must be sold, but the only buyers will be at greatly reduced prices causing a panic in the economy.
They will do ANYTHING to figure out how to keep John/Jane Q Public wanting to pay their inflated mortgage. Even at 0% interest, the myth is kept alive by the high principal balance.
What is best for the public is not what is best for the govt.
People walking away and buying a similar house in the future for 50% less than they owe today is good for the public.What the govt wants is to keep people from losing their homes so the system doesn’t collapse and staying in debt.
If the homes were “worth” more than people owed, the govt wouldn’t be so concerned.
$100bn is a good number to start. They will create more $ if they need to.
The situation is giving a new definition to the word CRISIS.ParticipantWe are facing economic meltdown. They will print an unlimited number of bills or create the ultimate fund to TRY and stop the tsunami. In the beginning they tried using an umbrella. It didn’t work.
The govts biggest fear right now is a collapse of housing prices. If thousands upon thousands walk away, they cannot burn the houses down, they must be sold, but the only buyers will be at greatly reduced prices causing a panic in the economy.
They will do ANYTHING to figure out how to keep John/Jane Q Public wanting to pay their inflated mortgage. Even at 0% interest, the myth is kept alive by the high principal balance.
What is best for the public is not what is best for the govt.
People walking away and buying a similar house in the future for 50% less than they owe today is good for the public.What the govt wants is to keep people from losing their homes so the system doesn’t collapse and staying in debt.
If the homes were “worth” more than people owed, the govt wouldn’t be so concerned.
$100bn is a good number to start. They will create more $ if they need to.
The situation is giving a new definition to the word CRISIS.ParticipantForeclosure will be on credit report for 7 years.
BK will be 10 years.
You can stall a foreclosure sale with a BK.IF they are being foreclosed on their original purchase money loans, 1st and 2nd, it is usually NON-recourse debt.
The loan is secured by the property, and nothing more.
They will have no tax consequences.If they have refi’d, whether they took cash out or not, it is recourse debt, and they could well be haunted for the loss OR income tax on the loss via a 1099-C (Cancellation of Debt)
See http://www.irs.gov for details
The tax consequences are not a reason to not be foreclosed on. You can only afford what you can afford.
The alternative to foreclosure is not being homeless,they will find a place to live, and probably for much less than their mortgage. It is not a terminal disease. It’s a financial business situation that people can recover from.
Most people aren’t used to having consequences of their financial decisions be negative. People don’t actually OWN homes until they are paid off. Until then you only have equity. If there is no equity today, and you put no money dow, what exactly are you walking away from other than emotion ??.
I think that many people who are getting foreclosed on will be better off once they get past the trauma. For some foreclosure is a blessing in disguise.
For those that are hanging on, they may easily owe 50% more than the home is worth, while those who walk can rebuild their lives and buy a similar home back in the future for less money, and less debt if they choose.
Although recent foreclosure on your credit is a problem to someone who wants to buy in 2007, I don’t think that will be an issue in a year or two.
With otherwise good credit and full doc, the market will be so desperate for home buyers to prop up prices, I think that a foreclosure will be overlooked with otherwise good credit.
ParticipantForeclosure will be on credit report for 7 years.
BK will be 10 years.
You can stall a foreclosure sale with a BK.IF they are being foreclosed on their original purchase money loans, 1st and 2nd, it is usually NON-recourse debt.
The loan is secured by the property, and nothing more.
They will have no tax consequences.If they have refi’d, whether they took cash out or not, it is recourse debt, and they could well be haunted for the loss OR income tax on the loss via a 1099-C (Cancellation of Debt)
See http://www.irs.gov for details
The tax consequences are not a reason to not be foreclosed on. You can only afford what you can afford.
The alternative to foreclosure is not being homeless,they will find a place to live, and probably for much less than their mortgage. It is not a terminal disease. It’s a financial business situation that people can recover from.
Most people aren’t used to having consequences of their financial decisions be negative. People don’t actually OWN homes until they are paid off. Until then you only have equity. If there is no equity today, and you put no money dow, what exactly are you walking away from other than emotion ??.
I think that many people who are getting foreclosed on will be better off once they get past the trauma. For some foreclosure is a blessing in disguise.
For those that are hanging on, they may easily owe 50% more than the home is worth, while those who walk can rebuild their lives and buy a similar home back in the future for less money, and less debt if they choose.
Although recent foreclosure on your credit is a problem to someone who wants to buy in 2007, I don’t think that will be an issue in a year or two.
With otherwise good credit and full doc, the market will be so desperate for home buyers to prop up prices, I think that a foreclosure will be overlooked with otherwise good credit.
ParticipantSTAN, perfect point that it cannot go on for long.
There are many people today who are refusing to lower their asking prices. Some because of emotion and some because of what they owe.
Many people today say that they cannot sell their house.
The reality is that they cannot sell their house at anywhere near what they are asking. If you had an unreserved auction, it would sell.It isn’t possible that anybody knows exactly how many homes will go to foreclosure. There are estimates, but until a sale is scheduled, we don’t have an exact idea. (NOD’s are a start)
Temec, after you buy your home, will you be looking for a 2nd one with a similar down payment ??
The question is who is going to buy the REO’s ??
I don’t believe that there are an equal number of Temecs with liquid reserves and solid situations equal to the avalanche of foreclosures coming.Take 500 foreclosed current “owners” who are losing homes because they cannot afford their new payment. Forget the fact that they now have a foreclosure on their credit history. Without crazy financing again, most still probably have no down payment and cannot qualify for a new purchase even at 50%-60% of what they previously owed.
That’s 500 homes added to inventory.Add in the psychological trauma that goes along with a foreclosure. Many won’t want to buy again ever for a long time.
At current market rents, there is still a long way to go for wise investors to step in.
Another big question is will there be enough UN-wise investors who step in and overpay before it gets to a level that the wise ones are interested ??
The motor is slowing down, the RPM’s are dropping.
The county stands to have a HUGE drop in property tax revenue as prices fall.
What’s next ???
ParticipantSTAN, perfect point that it cannot go on for long.
There are many people today who are refusing to lower their asking prices. Some because of emotion and some because of what they owe.
Many people today say that they cannot sell their house.
The reality is that they cannot sell their house at anywhere near what they are asking. If you had an unreserved auction, it would sell.It isn’t possible that anybody knows exactly how many homes will go to foreclosure. There are estimates, but until a sale is scheduled, we don’t have an exact idea. (NOD’s are a start)
Temec, after you buy your home, will you be looking for a 2nd one with a similar down payment ??
The question is who is going to buy the REO’s ??
I don’t believe that there are an equal number of Temecs with liquid reserves and solid situations equal to the avalanche of foreclosures coming.Take 500 foreclosed current “owners” who are losing homes because they cannot afford their new payment. Forget the fact that they now have a foreclosure on their credit history. Without crazy financing again, most still probably have no down payment and cannot qualify for a new purchase even at 50%-60% of what they previously owed.
That’s 500 homes added to inventory.Add in the psychological trauma that goes along with a foreclosure. Many won’t want to buy again ever for a long time.
At current market rents, there is still a long way to go for wise investors to step in.
Another big question is will there be enough UN-wise investors who step in and overpay before it gets to a level that the wise ones are interested ??
The motor is slowing down, the RPM’s are dropping.
The county stands to have a HUGE drop in property tax revenue as prices fall.
What’s next ???
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