Posted on: 21st Apr, 2008 02:52 pm
i am looking for a lender to do an fha loan. i am self employed so we are doing everything under my wife's name. we meet all of the fha guidelines and even though the upfront expenses are a lot more, the rate and payment (along with the guidelines) are very appealing.
we are in a 'unique' situation that no lenders will even acknowledge or even pretend to care about. we bought our home from the home builder that my wife works for. we received an 8% discount on the purchase price. in addition, since the discount was not part of the loan transaction, the purchase required 5% down. with simple logic and a 3rd grade math skill, you can see that we had 13% equity on the day we moved into our home.
we live in phoenix, and it is, admittedly, a horribly declining market. we were told by every lender before we purchased our home that it would be a lot easier to get a better rate etc. (because of our 'unique' situation) after the home closed. i did a lot of research and found multiple lenders that would refinance anywhere from 30 days after close to 'as soon as the ink dries'. armed with this information we proceeded with our purchase.
however, as everyone knows, in october everything began getting even worse than most people could imagine at the time. we were having more and more trouble trying to refi. none the less we were told by a company to get our credit up over 680 and wait until the loan had 'seasoned' 6 months. so we did. however, we are now having a great deal of trouble getting a loan.
i have been very careful with allowing people to run our credit - even just flat out telling lenders, i will get you what you need. i have copies of our credit reports from the big three. my wife's credit dropped 50 points in two months with only two people checking her credit. we have not had a late on anything since 2003 and we just paid off our old $186k mortgage and our $35k loc - i would have thought that her credit would have gone up 50 points not down 50.
anyway - my question is - i have hired veracity credit to try to get our credit reports to be accurate - and i have not had luck. i also have been told that our credit score is not supposed to be effected by multiple inquiries within a period of time as they understand that you are 'shopping' for a loan. this seems to be inaccurate big time. if i don't let a lender pull her credit they can't send it to underwriting - if i let them her score gets hit in the double digits.
every lender right now has one reason or another they can't do the loan - some want 12mo seasoning - (would have been nice if they told me that before running the credit) others send out appraisers who are $50k below what other appraisers where at.
is there no one protecting the consumer right now? my wife’s score has gone from 697 (middle score) to 666 in one month from two inquiries. we hit a patch of bad luck 40 months ago and we had to file bankruptcy. some of the creditors are still reporting late payments and derogatory on our credit reports and we have 'disputed' them only to receive letters saying that they are 'verified'.
are there any decent lenders left? can we sue past creditors for reporting incorrectly? does the government know that they are killing the economy by restricting guidelines on loans? people are being forced to sell their homes because they can't afford the adjusted rate. this is putting more homes on the market - since the guidelines have become so strict no one can even buy anymore no one can buy. we are in a vicious circle and the only way to stop it is by funding loans so homes can be purchased. this will cause the supply to decrease, the demand to increase, the values to go back up and the economy to correct itself. bailing out a lender who lost 3% of their profits last year (oh my bleeding heart) does not help the average american.
we pay $2,800.00/mo to our lender and we knock our principle down $422.00 - do you think for a second anyone believes these lenders are really 'losing money'? most of the people defaulting have paid there actual loan amount off three times by now.
who is still writing loans right now? scratch that – who is still pushing loans through and getting them funded right now?
signed: phrustrated in phoenix
we are in a 'unique' situation that no lenders will even acknowledge or even pretend to care about. we bought our home from the home builder that my wife works for. we received an 8% discount on the purchase price. in addition, since the discount was not part of the loan transaction, the purchase required 5% down. with simple logic and a 3rd grade math skill, you can see that we had 13% equity on the day we moved into our home.
we live in phoenix, and it is, admittedly, a horribly declining market. we were told by every lender before we purchased our home that it would be a lot easier to get a better rate etc. (because of our 'unique' situation) after the home closed. i did a lot of research and found multiple lenders that would refinance anywhere from 30 days after close to 'as soon as the ink dries'. armed with this information we proceeded with our purchase.
however, as everyone knows, in october everything began getting even worse than most people could imagine at the time. we were having more and more trouble trying to refi. none the less we were told by a company to get our credit up over 680 and wait until the loan had 'seasoned' 6 months. so we did. however, we are now having a great deal of trouble getting a loan.
i have been very careful with allowing people to run our credit - even just flat out telling lenders, i will get you what you need. i have copies of our credit reports from the big three. my wife's credit dropped 50 points in two months with only two people checking her credit. we have not had a late on anything since 2003 and we just paid off our old $186k mortgage and our $35k loc - i would have thought that her credit would have gone up 50 points not down 50.
anyway - my question is - i have hired veracity credit to try to get our credit reports to be accurate - and i have not had luck. i also have been told that our credit score is not supposed to be effected by multiple inquiries within a period of time as they understand that you are 'shopping' for a loan. this seems to be inaccurate big time. if i don't let a lender pull her credit they can't send it to underwriting - if i let them her score gets hit in the double digits.
every lender right now has one reason or another they can't do the loan - some want 12mo seasoning - (would have been nice if they told me that before running the credit) others send out appraisers who are $50k below what other appraisers where at.
is there no one protecting the consumer right now? my wife’s score has gone from 697 (middle score) to 666 in one month from two inquiries. we hit a patch of bad luck 40 months ago and we had to file bankruptcy. some of the creditors are still reporting late payments and derogatory on our credit reports and we have 'disputed' them only to receive letters saying that they are 'verified'.
are there any decent lenders left? can we sue past creditors for reporting incorrectly? does the government know that they are killing the economy by restricting guidelines on loans? people are being forced to sell their homes because they can't afford the adjusted rate. this is putting more homes on the market - since the guidelines have become so strict no one can even buy anymore no one can buy. we are in a vicious circle and the only way to stop it is by funding loans so homes can be purchased. this will cause the supply to decrease, the demand to increase, the values to go back up and the economy to correct itself. bailing out a lender who lost 3% of their profits last year (oh my bleeding heart) does not help the average american.
we pay $2,800.00/mo to our lender and we knock our principle down $422.00 - do you think for a second anyone believes these lenders are really 'losing money'? most of the people defaulting have paid there actual loan amount off three times by now.
who is still writing loans right now? scratch that – who is still pushing loans through and getting them funded right now?
signed: phrustrated in phoenix
Hi Tim,
I have read through your situation and what I feel is, these are hard inquiries that are affecting your score. What type of bankruptcy did you file? and are you discharged from it? there are decent lenders out there but perhaps things are not working for you right at the moment. But you needn't lose hope.
You can sue creditors but do you think it's the right time to do that? because you're already trying out for a loan and have had damaged your score due to inquiries, so why take additional hassles right now. Let things settle a bit and then you may talk to a lawyer in this regard.
It's true that people are selling their homes but it's not the government only, everything depends upon the way related financial and bond markets shape up. Moreover, borrowers too should bear the responsibility of not paying their loans in time; in fact there are many who've taken out loans in the recent past which they were not sure of managing and then landed themselves in trouble!
The thing is, you need to shop around till you get the best offer. Shopping helps you to compare the loans on the basis of the rates, fees and other factors ivolved. You need to make sure you're going with the right lender and the loan which you can afford.
Thanks
I have read through your situation and what I feel is, these are hard inquiries that are affecting your score. What type of bankruptcy did you file? and are you discharged from it? there are decent lenders out there but perhaps things are not working for you right at the moment. But you needn't lose hope.
You can sue creditors but do you think it's the right time to do that? because you're already trying out for a loan and have had damaged your score due to inquiries, so why take additional hassles right now. Let things settle a bit and then you may talk to a lawyer in this regard.
It's true that people are selling their homes but it's not the government only, everything depends upon the way related financial and bond markets shape up. Moreover, borrowers too should bear the responsibility of not paying their loans in time; in fact there are many who've taken out loans in the recent past which they were not sure of managing and then landed themselves in trouble!
The thing is, you need to shop around till you get the best offer. Shopping helps you to compare the loans on the basis of the rates, fees and other factors ivolved. You need to make sure you're going with the right lender and the loan which you can afford.
Thanks
Did you dispute the derogatory items with the bureaus? I suggest you talk to the individual creditors once and see what they have to say, why would you let your credit get the hit if you haven't made late payments at all? I suppose more than 6 months are over since you've gone for the purchase.
Bk does affect your chances of getting loans but how long is it that you've filed bk and has been discharged? I suggest you request for mortgage quotes from the lenders in this community and then let's see if they can help you out. To know what happens after you request for mortgage quotes, check out the page at http://www.mortgagefit.com/quote/ .
Bk does affect your chances of getting loans but how long is it that you've filed bk and has been discharged? I suggest you request for mortgage quotes from the lenders in this community and then let's see if they can help you out. To know what happens after you request for mortgage quotes, check out the page at http://www.mortgagefit.com/quote/ .
unfortunately, the equity you had in your home on the day you moved in evaporated in the declining value environment you are faced with. advice about refinancing at the time you received it may very well have been sound, but (as you acknowledge) you're in a declining market, and that situation has affected everything - indeed, everything.
telling creditors that you will provide your own credit report will not work - borrower-provided verifications are not allowable. if that were the case, you could go get your own appraisal, manufacture your own pay stubs, decide what bank statement to show, etc. methinks there's a little too much risk in allowing a borrower such latitude - i guess that's why nobody allows it.
you mentioned that "lenders" have sent out "appraisers" - this would seem to indicate to me that you've actually applied at numerous places. one thing about the lender/appraiser relationship - for the most part, there is a hands-off relationship between the two. by that i mean, the appraiser is, or at least ought to be, independent of the lender. one of the reasons we are in troubled times is that lenders made too many demands on appraisers to "come in at the right value." i seriously doubt that lenders are sending out appraisers for the purpose of devaluing property. the marketplace is what the marketplace is. in a declining market, just what do you think might happen to values? go up? stay flat? how about decline?
it is pretty apparent to me that your wife's credit score is being adversely affected by the creditors reporting derogatory information. "disputing" is probably not the way to go - how about documenting that they are incorrect so that they can be eliminated from the report altogether? is it that you lack the verification documentation? jameshogg mentioned the "hard inquiries," but i suspect the derogatory information has had a more deleterious effect on the scores.
there are plenty of decent lenders left. also, you can sue anyone at anytime for anything, but why clutter up the courts with frivolous actions? that won't help the typical american consumer either.
it would be interesting to know where you got that statistic - that "most of the people defaulting have paid there (sic) actual loan amount off three times now."
yes, lenders are losing money. yes, they have been making lots of money in prior years. is it a wash? of course not. if you had been making lots of money last year and suddenly began losing money this year, you'd be in a severe financial situation. similarly, lenders/banks/financial institutions spend money based on earnings in a particular time period. if those earnings are suddenly dropping due to a variety of market forces, it then becomes impossible to allocate the same funds to the same places that had previously been the case. somehow, this all makes sense to me. i hope you can begin to see the forest for the trees.
i commiserate with you in your current situation - please don't get me wrong. it is a terrible position to be placed in - to have plans and hopes and dreams based on what had been a burgeoning real estate market to up in flames suddenly because values have dropped. of course, you only put 5% down on the purchase price (after discount); and even though that 5% was really 13%, that's not a substantial amount of equity in either case. with a monthly payment of $2800, i surmise that your mortgage is likely fairly substantial. of course, your equity shrinkage is going to be more dramatic than many others - after all, 10% (for example) of a lot is quite a bit of money.
it would seem you're between a rock and a hard place. if values of homes in your area have declined to a point below what your mortgage is, you won't be finding too many lenders to be actively seeking out your business. if you can sit tight and wait out this market until a correction takes place, that would seem to be your best option.
it may be a bitter pill, but adding bitterness to its bitterness isn't going to make it go away.
bon chance!
telling creditors that you will provide your own credit report will not work - borrower-provided verifications are not allowable. if that were the case, you could go get your own appraisal, manufacture your own pay stubs, decide what bank statement to show, etc. methinks there's a little too much risk in allowing a borrower such latitude - i guess that's why nobody allows it.
you mentioned that "lenders" have sent out "appraisers" - this would seem to indicate to me that you've actually applied at numerous places. one thing about the lender/appraiser relationship - for the most part, there is a hands-off relationship between the two. by that i mean, the appraiser is, or at least ought to be, independent of the lender. one of the reasons we are in troubled times is that lenders made too many demands on appraisers to "come in at the right value." i seriously doubt that lenders are sending out appraisers for the purpose of devaluing property. the marketplace is what the marketplace is. in a declining market, just what do you think might happen to values? go up? stay flat? how about decline?
it is pretty apparent to me that your wife's credit score is being adversely affected by the creditors reporting derogatory information. "disputing" is probably not the way to go - how about documenting that they are incorrect so that they can be eliminated from the report altogether? is it that you lack the verification documentation? jameshogg mentioned the "hard inquiries," but i suspect the derogatory information has had a more deleterious effect on the scores.
there are plenty of decent lenders left. also, you can sue anyone at anytime for anything, but why clutter up the courts with frivolous actions? that won't help the typical american consumer either.
it would be interesting to know where you got that statistic - that "most of the people defaulting have paid there (sic) actual loan amount off three times now."
yes, lenders are losing money. yes, they have been making lots of money in prior years. is it a wash? of course not. if you had been making lots of money last year and suddenly began losing money this year, you'd be in a severe financial situation. similarly, lenders/banks/financial institutions spend money based on earnings in a particular time period. if those earnings are suddenly dropping due to a variety of market forces, it then becomes impossible to allocate the same funds to the same places that had previously been the case. somehow, this all makes sense to me. i hope you can begin to see the forest for the trees.
i commiserate with you in your current situation - please don't get me wrong. it is a terrible position to be placed in - to have plans and hopes and dreams based on what had been a burgeoning real estate market to up in flames suddenly because values have dropped. of course, you only put 5% down on the purchase price (after discount); and even though that 5% was really 13%, that's not a substantial amount of equity in either case. with a monthly payment of $2800, i surmise that your mortgage is likely fairly substantial. of course, your equity shrinkage is going to be more dramatic than many others - after all, 10% (for example) of a lot is quite a bit of money.
it would seem you're between a rock and a hard place. if values of homes in your area have declined to a point below what your mortgage is, you won't be finding too many lenders to be actively seeking out your business. if you can sit tight and wait out this market until a correction takes place, that would seem to be your best option.
it may be a bitter pill, but adding bitterness to its bitterness isn't going to make it go away.
bon chance!
Thank you for the info. I agree that home owners do need to share some of the blame. That being said - I also believe that a great many of them fell for the same thing we did (luckily we were able to sell our home in the tiny window of our payment doubling and the prepayment penalty of 6k expiring)
Almost every consumer was told - do this teaser ARM for now - we will streamline your loan in 2yrs when your credit is better at no charge. In addition, have you read through a purchase contract lately? There is no way the average person could ever be expected to understand some of the jargon in those things.
I have a relatively high IQ, my wife's is probably higher. I will be the first person to tell you that half of the things in the GFE are too confusing for either of us - let alone the purchase contract and loan docs. I am sure that several people thought they would have their loan streamlined into a fixed rate after two years. We had raised our credit scores 150 points in that time banking on it. When the time came the broker was no where to be found and all of the guidelines had changed.
The blame that the consumer needs to take is for trusting someone that they believed was giving them 'professional' advice. Don't trust anyone - lesson learned. There is a reason that at closing the escrow officer explains each page in a 'crib note version' - the average person could never be expected to understand the language used.
As far as the bankruptcy it was discharged April 2nd, 2005. It was the one that makes sense to file (where you don't pay anything back). The bankruptcy itself has hurt us very little. It has mostly been seasoning of the loan and in particular the creditors still reporting late payments on our credit report for items discharged 3 years ago.
We don't care about the 1k for each instance, if I could find a lawyer willing to take care of the creditors and stop the reporting he could keep the 1k for each instance - which is now eight instances. They have been informed of their mistake in writing multiple times, yet they have continued.
Bankruptcy is a bad thing to do and we felt horrible not taking responsibility for our debt - however, there are stories like ours - we had a business go bad and we were being sued for 10 million dollars (the remaining amount on the lease) It was a three way lawsuit - in order for us to collect on those damages from the third party we had to first have the judgement against us. Since the third party is a multi-million dollar corporation we were told that it could take 10yrs of fighting in court and we wouldn't be awarded our attorney fee's. As a result, we were told by an attorney that a bankruptcy was our only real course of action to avoid losing everything we had worked for.
Again though - the bankruptcy has not hurt us at all - we refinanced a year afterwards - when our credit scores were 150 points lower than they are now and the bankruptcy was only 12mo removed. We also got a $40k LOC 24mo after the bankruptcy. The problem is the current guidelines, not a BK. In addition, we are looking at an FHA - with credit scores of 666 and 675 we are well above the 580 needed. It just pisses me off to no end that creditors can do something that is 'against the law' and there is nothing I can do about it. If I spit in the street I would be arrested. Where is the protection for the consumer. I am so sick of being told that things like this are 'probably not worth our time and/or money'. Justice - there is now a price and time stamp on justice?
I did fill out the form mailer - but I was referred to 'First Horizon' which is listed on the 'ailing lender watch list'
ml-implode.com
I am tired of wasting my time. I am looking for someone who can do what they say. I don't like magic much so watching a loan disappear doesn't impress me.
Still Phrustrated in Phoenix-
Almost every consumer was told - do this teaser ARM for now - we will streamline your loan in 2yrs when your credit is better at no charge. In addition, have you read through a purchase contract lately? There is no way the average person could ever be expected to understand some of the jargon in those things.
I have a relatively high IQ, my wife's is probably higher. I will be the first person to tell you that half of the things in the GFE are too confusing for either of us - let alone the purchase contract and loan docs. I am sure that several people thought they would have their loan streamlined into a fixed rate after two years. We had raised our credit scores 150 points in that time banking on it. When the time came the broker was no where to be found and all of the guidelines had changed.
The blame that the consumer needs to take is for trusting someone that they believed was giving them 'professional' advice. Don't trust anyone - lesson learned. There is a reason that at closing the escrow officer explains each page in a 'crib note version' - the average person could never be expected to understand the language used.
As far as the bankruptcy it was discharged April 2nd, 2005. It was the one that makes sense to file (where you don't pay anything back). The bankruptcy itself has hurt us very little. It has mostly been seasoning of the loan and in particular the creditors still reporting late payments on our credit report for items discharged 3 years ago.
We don't care about the 1k for each instance, if I could find a lawyer willing to take care of the creditors and stop the reporting he could keep the 1k for each instance - which is now eight instances. They have been informed of their mistake in writing multiple times, yet they have continued.
Bankruptcy is a bad thing to do and we felt horrible not taking responsibility for our debt - however, there are stories like ours - we had a business go bad and we were being sued for 10 million dollars (the remaining amount on the lease) It was a three way lawsuit - in order for us to collect on those damages from the third party we had to first have the judgement against us. Since the third party is a multi-million dollar corporation we were told that it could take 10yrs of fighting in court and we wouldn't be awarded our attorney fee's. As a result, we were told by an attorney that a bankruptcy was our only real course of action to avoid losing everything we had worked for.
Again though - the bankruptcy has not hurt us at all - we refinanced a year afterwards - when our credit scores were 150 points lower than they are now and the bankruptcy was only 12mo removed. We also got a $40k LOC 24mo after the bankruptcy. The problem is the current guidelines, not a BK. In addition, we are looking at an FHA - with credit scores of 666 and 675 we are well above the 580 needed. It just pisses me off to no end that creditors can do something that is 'against the law' and there is nothing I can do about it. If I spit in the street I would be arrested. Where is the protection for the consumer. I am so sick of being told that things like this are 'probably not worth our time and/or money'. Justice - there is now a price and time stamp on justice?
I did fill out the form mailer - but I was referred to 'First Horizon' which is listed on the 'ailing lender watch list'
ml-implode.com
I am tired of wasting my time. I am looking for someone who can do what they say. I don't like magic much so watching a loan disappear doesn't impress me.
Still Phrustrated in Phoenix-
if i were to start a blog, i could probably mention most every lender in this country as likely to "implode" as well as numerous of those overseas. how accurate is the "ml-implode" website? well, they have certainly listed all those who have imploded, haven't they?
as for first horizon, i have nothing to do with managing the company - i am a relationship manager. what that means is that i develop a relationship with my borrower/customer so that i am able to guide and direct each person to the best product and to give the best advice i am capable of. i know you'll find this amazing - but i don't lie to my customers, nor do i hide things from them for fear they will know what they're getting into.
if you take the time to read and try to understand mortgage documents, they are truly not so obtuse - they are actually understandable. having someone go through them - preferably someone competent - is certainly helpful. i don't know about the "crib sheet" method.
i am not a big fan of a lot of the disclosures set out by the government for us to provide to consumers. much of the information is useless, though it still constitutes truth in lending. as for the "truth" in lending, you are clearly correct in thinking that there are some unscrupulous and dishonest people in the mortgage business. as with everything else, the people involved are part of the overall populace, which has all sorts in it.
"almost every consumer" being told about a teaser rate? don't consumers go into things with their eyes open? and if it is truly a teaser rate, didn't they take the worst case scenario into account? my mortgage was written using a "teaser" rate - i have a 5-year variable, and the rate at which it was written was less than the fully-indexed rate. in making that choice, i had to reasonably expect that i would either be able to refinance at the 5-year point or afford the payment at the elevated rate. i'm still not at the 5-year point, so i don't know what the end result will be, but at least i took the blinders off before i signed my name. i knew what i was getting into.
i am curious as to what laws were broken in your case. one would think, i agree, that you ought to have recourse against those who wronged you. from your original post, however; it seems more likely that you were simply the unfortunate victim of circumstances, to have purchased in what has become a declining market; and of course, those circumstances have been compounded by what you note are the creditors reporting the derogatory information. you've not said that the information being reported was inaccurate - simply that you took the time to "dispute" them unsuccessfully.
i agree with you - it makes no sense wasting your time, and magic is only a temporary thing anyway. it has no staying power.
as for first horizon, i have nothing to do with managing the company - i am a relationship manager. what that means is that i develop a relationship with my borrower/customer so that i am able to guide and direct each person to the best product and to give the best advice i am capable of. i know you'll find this amazing - but i don't lie to my customers, nor do i hide things from them for fear they will know what they're getting into.
if you take the time to read and try to understand mortgage documents, they are truly not so obtuse - they are actually understandable. having someone go through them - preferably someone competent - is certainly helpful. i don't know about the "crib sheet" method.
i am not a big fan of a lot of the disclosures set out by the government for us to provide to consumers. much of the information is useless, though it still constitutes truth in lending. as for the "truth" in lending, you are clearly correct in thinking that there are some unscrupulous and dishonest people in the mortgage business. as with everything else, the people involved are part of the overall populace, which has all sorts in it.
"almost every consumer" being told about a teaser rate? don't consumers go into things with their eyes open? and if it is truly a teaser rate, didn't they take the worst case scenario into account? my mortgage was written using a "teaser" rate - i have a 5-year variable, and the rate at which it was written was less than the fully-indexed rate. in making that choice, i had to reasonably expect that i would either be able to refinance at the 5-year point or afford the payment at the elevated rate. i'm still not at the 5-year point, so i don't know what the end result will be, but at least i took the blinders off before i signed my name. i knew what i was getting into.
i am curious as to what laws were broken in your case. one would think, i agree, that you ought to have recourse against those who wronged you. from your original post, however; it seems more likely that you were simply the unfortunate victim of circumstances, to have purchased in what has become a declining market; and of course, those circumstances have been compounded by what you note are the creditors reporting the derogatory information. you've not said that the information being reported was inaccurate - simply that you took the time to "dispute" them unsuccessfully.
i agree with you - it makes no sense wasting your time, and magic is only a temporary thing anyway. it has no staying power.
Perhaps you're not trying to be elected president of the world-owes-me-a-living society but there's a lot of belly aching. A reality check could well be in order.
Seasoning is NOT a requirement in the conforming world. Maybe, just maybe, the value isn't there. Arizona is a disaster area which at least you do admit. Builder discounts are "neat" but in a "thin" subdivision it puts a "comp" on public record which hurts further appraisals. Not a real bright move on the part of the builder. Current appraised value may well be an issue given your other comments. That's the lender's fault?!
"I'm self employed so we NEED to do on my wife's data". HUH? Non sequitor. We all do self-employed borrowers who honestly report on their tax returns and have stable businesses. The fault, dear Brutus ... Why pass blame on to lenders and/or brokers for this "inadequacy"?
Two inquires dropped your representative FICO from 697 to 666 and this violated your "consumer rights"? Possible the inquires were the culprit but what were the "reason codes" shown on the credit report? This will show the primary causes of the current FICO. What effect did this move have? Since you indicate you've paid off your first and second mortgages (again not really a bright move), I assume you're doing a cash-out refinance. If the assumption is correct, the FICO of 697 was nothing to write home about and, depending on the LTV, would have incurred a 1.5 discount point "hit" for cash-outat either score but an increase of about ¾ "hit" for general FICO degradation. Not much a relative move; just a basic reflection of the credit history YOU (or more accurately your wife) developed. Nobody in the industry is doing back flips over the new FICO "hits" but it boils down to how long Fannie and Freddie should subsidize the "ify" areas of the borrower market.
"3%" reduction in profit. Guess you missed the BofA results. Oh well, it's easier to ignore facts. "People defaulting have paid their (sic) actual loan amount off three times by now." Did you take math in high school? I suppose if you had a CD for ten years, it would be all right if the bank just gave you back the original deposit - no interest.
Suck in your gut, admit your short comings and the bad AZ market, and be thankful that FHA offers the best cost-effective solution.
Seasoning is NOT a requirement in the conforming world. Maybe, just maybe, the value isn't there. Arizona is a disaster area which at least you do admit. Builder discounts are "neat" but in a "thin" subdivision it puts a "comp" on public record which hurts further appraisals. Not a real bright move on the part of the builder. Current appraised value may well be an issue given your other comments. That's the lender's fault?!
"I'm self employed so we NEED to do on my wife's data". HUH? Non sequitor. We all do self-employed borrowers who honestly report on their tax returns and have stable businesses. The fault, dear Brutus ... Why pass blame on to lenders and/or brokers for this "inadequacy"?
Two inquires dropped your representative FICO from 697 to 666 and this violated your "consumer rights"? Possible the inquires were the culprit but what were the "reason codes" shown on the credit report? This will show the primary causes of the current FICO. What effect did this move have? Since you indicate you've paid off your first and second mortgages (again not really a bright move), I assume you're doing a cash-out refinance. If the assumption is correct, the FICO of 697 was nothing to write home about and, depending on the LTV, would have incurred a 1.5 discount point "hit" for cash-outat either score but an increase of about ¾ "hit" for general FICO degradation. Not much a relative move; just a basic reflection of the credit history YOU (or more accurately your wife) developed. Nobody in the industry is doing back flips over the new FICO "hits" but it boils down to how long Fannie and Freddie should subsidize the "ify" areas of the borrower market.
"3%" reduction in profit. Guess you missed the BofA results. Oh well, it's easier to ignore facts. "People defaulting have paid their (sic) actual loan amount off three times by now." Did you take math in high school? I suppose if you had a CD for ten years, it would be all right if the bank just gave you back the original deposit - no interest.
Suck in your gut, admit your short comings and the bad AZ market, and be thankful that FHA offers the best cost-effective solution.
some hard words, guest; but i can't disagree with you. i do think you erred in one spot, concerning the poster's having paid off his first and second mortgages. i believe that was referring to his previous mortgage loans on a previous home; else, he wouldn't have so much trouble trying to dig some cash out of his current residence.
in general, i think you hit the nail on the head, though. good post.
in general, i think you hit the nail on the head, though. good post.
hopefully things will work out for you, hope so, keep us updated on your sitiuation, there will be others come along in the same situation as you and they will benefit from what you post here.
Yes, I don't think ''Guest" - even read my post - because no one is that dumb. You can't possibly come to some of the conclusions that he / she did if you have, even a 2nd grade, comprehension level.
George is right - while he and I can 'agree to disagree', it appears that he at least read the post and understood it. The mortgages paid off were indeed our first and second on our old home. When $280k of debt falls off your credit report you would expect the score to increase.
Secondly the SIC being paid off - is INDEED accurate - if I pay $2,800.00/mo on a $313k loan for 3yrs (a total of $100,800.00) and than I default on my loan when the rate changes - that would leave an actual 'hard money out of pocket' $213 for the lender. They short sell the home for $269k to unload it quickly and they still had the principle paid in full. There is nothing wrong with my math 'Guest'. As far as schooling goes, you remind me of the a-hole on Billy Madison that can't give the definition of 'business ethics'. No one with a soul could possibly defend the banks right now. The actual amount of foreclosures is WELL under 1%. (cnn.com) That means that more than 99% of the loans are still delivering the 'pound you in the a$$ prison' interest every month like clockwork. I would do anything to have less than 1% of my business adventures fail. Do you feel bad for Exxon too 'Guest'? I would bet that the profit rate for most of those banks was WELL above the 7.9% quarterly that Exxon saw.
I saw Fannie May is in trouble -
I hope they crash and burn. There is a very special place in the fiery pits of hell for them and everyone else who has tightened up the guidelines so much that families like us - who make over $180k/yr and OWN our 2006 vehicles ($32k Titan - $28k Quest - $12k VTX1800 - paid w/cash) can't even get approved for a loan. Yes our 690 score isn't fantastic - but FHA requires low 500's so it is 40% better than it needs to be.
What is better is that the remaining brokers struggling to 'defend' b.s. policies and guidelines will go out of business. It was funny when I was listing my house for sale there was one set of rules for determining the value - now the market has changed and so has the set of rules because the 'old rules' could somehow help me. They bend everything to screw the home owner. Most people would say - "He who has the money makes the rules." My response is - um - I am paying you over $2k/mo in interest - therefore I HAVE THE MONEY jack ass. You are borrowing it, just the same as I am - I am at the bottom of the hill forking out the money to keep your doors open.
It doesn't matter, I have the money to make our inflated payment, luckily I can write it off at the end of the year. In the meantime I have filed reports with every agency that would allow it - by the time National City Mortgage finishes responding to all of the investigations the market will have improved and we will have moved our loan to a bank that uses a little Vaseline before using my a$$ as a hat.
George is right - while he and I can 'agree to disagree', it appears that he at least read the post and understood it. The mortgages paid off were indeed our first and second on our old home. When $280k of debt falls off your credit report you would expect the score to increase.
Secondly the SIC being paid off - is INDEED accurate - if I pay $2,800.00/mo on a $313k loan for 3yrs (a total of $100,800.00) and than I default on my loan when the rate changes - that would leave an actual 'hard money out of pocket' $213 for the lender. They short sell the home for $269k to unload it quickly and they still had the principle paid in full. There is nothing wrong with my math 'Guest'. As far as schooling goes, you remind me of the a-hole on Billy Madison that can't give the definition of 'business ethics'. No one with a soul could possibly defend the banks right now. The actual amount of foreclosures is WELL under 1%. (cnn.com) That means that more than 99% of the loans are still delivering the 'pound you in the a$$ prison' interest every month like clockwork. I would do anything to have less than 1% of my business adventures fail. Do you feel bad for Exxon too 'Guest'? I would bet that the profit rate for most of those banks was WELL above the 7.9% quarterly that Exxon saw.
I saw Fannie May is in trouble -
I hope they crash and burn. There is a very special place in the fiery pits of hell for them and everyone else who has tightened up the guidelines so much that families like us - who make over $180k/yr and OWN our 2006 vehicles ($32k Titan - $28k Quest - $12k VTX1800 - paid w/cash) can't even get approved for a loan. Yes our 690 score isn't fantastic - but FHA requires low 500's so it is 40% better than it needs to be.
What is better is that the remaining brokers struggling to 'defend' b.s. policies and guidelines will go out of business. It was funny when I was listing my house for sale there was one set of rules for determining the value - now the market has changed and so has the set of rules because the 'old rules' could somehow help me. They bend everything to screw the home owner. Most people would say - "He who has the money makes the rules." My response is - um - I am paying you over $2k/mo in interest - therefore I HAVE THE MONEY jack ass. You are borrowing it, just the same as I am - I am at the bottom of the hill forking out the money to keep your doors open.
It doesn't matter, I have the money to make our inflated payment, luckily I can write it off at the end of the year. In the meantime I have filed reports with every agency that would allow it - by the time National City Mortgage finishes responding to all of the investigations the market will have improved and we will have moved our loan to a bank that uses a little Vaseline before using my a$$ as a hat.
Well Tim, I appreciate the way you analyzed the entire situation. I do think if you've paid your mortgages, your score should go up. But may be there's some discrepancy somewhere.
Yes, there are areas where the guidelines in the industry can be improved but it's a fact that at times we too make mistakes and take up things that we cannot move on with later. But anyway, it's good that people like you are making an effort to speak out in a forum like this with someone like George who's there to clarify things as he knows more about the industry than you and I know of course.
I guess more and more people need to come forward and get clarified on certain things that are happening in the industry. The lawmakers or industry professionals need to find out whether the laws and rules are helpful or not to the common people. This will help them make relevant changes and make things better. I am optimistic about such changes though it may take time.
Anyway, good to know that things are likely to settle for you soon. I wish you best of luck for the future. If you feel like discussing more issues, feel free to do so.
Regards,
Jessica.
Yes, there are areas where the guidelines in the industry can be improved but it's a fact that at times we too make mistakes and take up things that we cannot move on with later. But anyway, it's good that people like you are making an effort to speak out in a forum like this with someone like George who's there to clarify things as he knows more about the industry than you and I know of course.
I guess more and more people need to come forward and get clarified on certain things that are happening in the industry. The lawmakers or industry professionals need to find out whether the laws and rules are helpful or not to the common people. This will help them make relevant changes and make things better. I am optimistic about such changes though it may take time.
Anyway, good to know that things are likely to settle for you soon. I wish you best of luck for the future. If you feel like discussing more issues, feel free to do so.
Regards,
Jessica.
thanks for all the kudos everyone, but i am now officially out of this discussion. there is way too much animosity apparent here for me.
God Bless Us, Everyone. (Tiny Tim)
God Bless Us, Everyone. (Tiny Tim)
Being so far ahead of the curve. However, it is nice to know eventually the rest of the world catches up. Maybe they read my blog? j/k
calculatedrisk.blogspot.com/2008/05/fannie-maes-120-refinances.html
calculatedrisk.blogspot.com/2008/05/fannie-maes-120-refinances.html