Well yes and no.
It's easy to say they're at fault, should have read the fine print and so on - yes, indeed they should have. The article states their Realtor gave assurances they trusted about rate changes and of course they wanted to believe that.
However, such ridiculously easy to obtain mortgage funding is only a step away from loan sharking IMHO, do the loan companies truly believe borrowers like this can repay over the long term ? No, but they don't care, they'll just sell the note anyway.
Despite the slogans, can Realtors be trusted or are they too just in it for their own gain ? Recognising of course that the Realtor most often acts for the seller.
Most first time buyers don't know much, I know I didn't, but back when I bought my first you had to have a down payment and meet seemingly firm tests about income etc to qualify, that is all out of the window these days.
Stories like this couple's will be very common quite soon, more's the pity.
"It's easy to say they're at fault, should have read the fine print and so on - yes, indeed they should have. The article states their Realtor gave assurances they trusted about rate changes and of course they wanted to believe that.
However, such ridiculously easy to obtain mortgage funding is only a step away from loan sharking IMHO, do the loan companies truly believe borrowers like this can repay over the long term ? No, but they don't care, they'll just sell the note anyway.
Despite the slogans, can Realtors be trusted or are they too just in it for their own gain ? Recognising of course that the Realtor most often acts for the seller.
Most first time buyers don't know much, I know I didn't, but back when I bought my first you had to have a down payment and meet seemingly firm tests about income etc to qualify, that is all out of the window these days.
Stories like this couple's will be very common quite soon, more's the pity."
You are either extremely intelligent, or you are in the profession, and are aware of the tremendous profits mortgage companies have been making........often at the expense of the unaware, unsavvy buyer.
First mistake of many. Realtors don't understand finance (as a rule) and are possibly the worst person to ask. Besides, they have an inherent conflict of interest. I'm a former mortgage broker (6.5 years) quit beginning of August this year and I'm studying for my Series 7 license. Would anyone like to talk about this, or ask questions of someone who truly knows what they're talking about?
I agree about first home buyers. My husband and I were in our 20s when we bought our first home, we did not go for the ARM, but we did get a mortgage where our payment went up 50 dollars a year for 5 years, reason being that some of the interest was being deferred. In short, what we had was negative amortization. We also paid a ridiculous amount in points, something I did not pay attention to till we refinanced the first house. I knew nothing about points, title insurance, and yes, you can read the papers, but at the time, we were getting what seemed like a lot of paperwork and there were constant requests for information, making the whole process very frustrating. Our experience when we refinanced our first home was almost as unpleasant as when we first bought the house. 3 years ago when we bought our second home, I had a problem with the loan company which I mentioned to one of the employees of the builder, she straightened it out for me, fortunately. I've learnt a lot since the first home.
I recommend to anyone who's buying a house for a first time to make sure they get advice from someone who's been there done that. Loan companies are sharks, imo
The first time I was looking at buying a house, I spent $10 on a book about buying one's first home.
It was money well spent.