Posted on 08/21/2007 8:18:53 AM PDT by Hydroshock
Two years ago, my wife and I sat at a long conference table in a mortgage-title office in Bethesda. Sitting next to us: our real estate agent, who drew up our bid on a townhouse in Germantown two days after showing it to us. We didn't get an inspection, and I don't recall going back for a second look. We had to act fast or someone else would get it.
Our bid won the house -- our very own first home -- and now we had to close the deal. The owners sat across the table. They seemed more nervous than we did, perhaps fearing we would have second thoughts -- about our risky interest-only mortgage, about seeing them walk away with a $120,000 profit, about buying a house just as "bubble" was entering the regional lexicon.
They signed. We signed. Price tag: $459,275.
And then, as the saying sort of goes, the stuff hit the fan. The sizzling home market almost immediately began to cool off, which my wife and I sort of ignored. Interest rates started to creep up, and we sort of blew that off, too. We have time. This too shall pass. No worries. Life is good! We bought a flat-panel television, took a nice vacation, bought a dog, hired him a daily dog-walker, and then we got pregnant. We have time. This too shall pass.
(Excerpt) Read more at washingtonpost.com ...
That was my first thought! Geez, it's bad enough to know you've been stupid, but running around explaining to everyone just how stupid you were...it boggles the mind.
I call BS. I have no doubt that the lender who gave these people their mortgage pulled credit. I am 100% positive.
Now, I didn't read the entire article, and don't know if the info is contained in it, but it is possible they got a "no doc" or "no income verification" loan. But they still would have had to credit qualify.
I did mortgages for 10 years until a year and a half ago. My bread and butter was a no doc loan. And it was so easy we could take an app, do an appraisal, and close within a week. I loved this product. But to qualify for it you had to have a rock solid, top of the food chain credit history.
I remember doing mortgages in the late 90's early 2000's when rates just plummeted and a realtor I did a lot of business with showed me one of her books from when she got her license. It was only a couple years old. The mortgage charts didn't go below 11%!!!
yes--i know... maybe they were not ready to purchase if they had to get that kind of loan...
My first mortgage was 8.5% in 1992. At the time I was proud of such a low interest rate. With any mortgage loan I’ve ever gotten, the lender has always asked if I’m a risk taker or not. I’m not so I always went with a fixed rate. The couple knew the risks or should have known if they had any sense of responsibility. Even someone with the least amount of education is FREE to study the facts and make a decision they are prepared to live with. You take risks, you live with the consequences. Nobody else should have to cover your rear.
I call BS. I have no doubt that the lender who gave these people their mortgage pulled credit. I am 100% positive. Now, I didn't read the entire article, and don't know if the info is contained in it, but
I thought it was obvious I was referring to this entire mess in general, not one single person.
“We had to act fast or someone else will get it.”
This sentence tells the whole story. Seems he was led around by the nose when he bought his first home. Years ago in the sales business this guy was referred to as a “cake.”
Ok, I repeat. I call BS. Every person whose sob story you are reading in the paper and seeing on the news had their credit checked in order to obtain the mortgage they have.
I assume when they bought the market there was red hot and the above statement is actually accurate.
I know here in the Triangle area of NC, several small towns had such demand for homes that they sold before going on the market and had in excess of a dozen offers on them just from a realtor saying "X is considering selling their home" to other realtors.
If you didn't jump within 5 seconds of hearing this, you lost.
In fact, my aunt and uncle sold their house in Apex NC last year. The thing is it was NEVER on the market. They had never talked to a realtor. Nothing. But every couple weeks for 10 years someone would just show up at the house and ring the bell or leave a note saying "I want your house. I will pay X."
Finally the number was too big to turn down.
The same day, 3 offers for asking price came in.
Total time from listing in MLS to slapping a sold sign out front. 9 days.
You bet slick.
I guarantee that 100% of them had to.
But when the guy wrote a number on the note he left for them that could not be ignored, and he would allow them to lease back the for their current mortgage payment until their new house was built, they couldn't say no.
You will note that no where did I say these buyers were properly qualified and the lenders were ethical.
LOL!!
These two quotes of yours above are the funniest damn thing I read in the past 2 days.
What a great laugh.
Thanks.
Do you disagree? Do you have evidence to show that these sorry sacks in the news obtained their mortgages without the lender pulling a credit report?
There is *plenty* of guilt to go around. Those in the lending/mortgage industry were not professional or ethical. This whole thing was greed driven, and most everyone knows it, expect maybe you.
Tell me, do you *honestly* feel in the past 3 years or so the mortgage/lending industry was practicing professional and ethical standards?
And the above is what I was referring to.
Do you still stand by this.
Regarding the ethical practices of some lenders, there were some that were dishonest, lied, cheated, and stole. No doubt. But the industry as a whole is not at fault. Infact, more than anyone GOVERNMENT is at fault. With its continual demands and requirements on lending institutions to lend in certain areas. To certain racial groups. To certain income levels. Etc... Trust me. Those demands were made. And when a program was created to fill the requirement, it was expanded country wide and made available to everyone.
Subprime lending is a needed aspect of the credit market.
The problem is that people who had no business buying a house at any price point were able to do so through these "helper" type loans as they were originally constituted.
If some idiot who can only afford a $100,000 home with zero down decides to get an exotic, option ARM loan and purchase a $350,000 home and can't pay the price anymore, thats not my fault or the lenders fault. Its his fault.
Sounds like the author needs to learn to act his wage.
Yep.
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