Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
At closing you are given specific documentation showing your loan terms, fixed or adjustable, the length of the loan, etc. I don't see how it was possible that people did not understand. They agree to an attorney with the seller and have the option of having their own attorney as well.
IN NY many just stick an adjustable rate "rider" somewhere in the body of the mortgage and tie the future rate to some freakish lunar foreign prime rate PLUS 7! its ridiculas.
Don't know if thats the case country-wide, but its pretty to easy miss if you are not too savvy.
Last edited by BK2Westchester; 10-22-2008 at 11:54 AM..
The lawsuit said Williams, the sales agent, falsified documents to help buyers get loans for Beazer homes. Among the allegations are that assets and debts were misrepresented on loan applications and important information concealed
Again, none of this is what you stated earlier. No one is claiming they were sold an ARM under the presumption it was a fixed rate.
The problem was that by lying about income and debt on the loan applications they were able to qualify people for homes they shouldn't have qualified for in the first place.
Everyone knew going in what their rates were, what their payments would be. A simple calculator would have told them they were getting in over their head regardless of what the builder told them they could afford.
just think people need to take a look at this again.
Quote:
Originally Posted by NCyank
...and home buyers fell for it, hook line and sinker.
Look, when we bought our house 5 years ago I nearly choked at how much the bank approved for us. It was really funny. We could live in a REALLY nice house...as long as we didn't need any money to pay bills, save for college or retirement, or eat. We took a loan for about 1/4 of what the max they offered and still have a nice house in a nice area. Our agent was a bit disappointed as she was hoping for a fatter commission based on what we qualified for rather than what we actually spent.
We were smart enough to know that what they offered us was not in our best interest. The banks are in the business of selling a product and that product is debt. They will sell as much as you will buy whether it be in the form of a mortgage, car payment or CC. Yes, they are snakes for offering so much credit to people who can't afford it, but in the end it is the home owner, or the person buying the car or applying for yet another CC who is making the choice to play with snakes.
I see the real estate agents as being least responsible here. Their job isn't to tell the buyer what to do, how much to finance, etc. BrokerDave sounds like a responsible agent who was looking out for his clients more than most...pointing out the snakes to folks who didn't see the danger for themselves.
1 of the main things i try to explain to clients is double payments. if you cant afford double payments you shouldn't be buying the home. particularly those who want to put zero down or anything under 20%. when you make double payments you can pay a loan off in 5.9 years, amazing isn't it? lol.
Quote:
Originally Posted by BK2Westchester
I don't dissagree EXCEPT for the fact the predatory lending does exist.
Not everyone is as educated as you may be and thousands relied on the consultation of their mortgage broker who in many cases misled them with teaser rates and neg-am mortgages, ARMS, etc.
EVERYBODY knows what they can afford per month regardless what they want to afford. they know how much they make and can spend. 7 out of every 10 of my clients know thier budgets so well they aren't willing to go outside of it $1. ONCE AGAIN, EVERYBODY KNOWS WHAT THEY CAN AFFORD. There is thousands of mortgage calculators online books, people who are knowledgeable. Rarely is anyone un-informed.
Quote:
Originally Posted by *Danielle*
I agree...until they found home builders who had their own mortgage companies that LIED to the first time home buyers. Telling them their rates would be fixed permanently when in fact they were not. They were lied too... How can the buyers be held responsible for that?
You can argue this angle, but i don't think you can group all builders into this. and i really think that most people lied about this to cover themselves. if there is one thing i've learned about people being in this business is, EVERYBODY LIES and hopes nobody will find out.
Quote:
Originally Posted by BK2Westchester
This is where you are wrong.
Lack of basic understanding of real estate is not what got so many people in trouble.
Its the complexity and structure of these loan programs that hurt people when brokers didn't explain it in the best interest of the client. When things get complex (complexity being relative, of course), people tend to rely on professionals they hire.
We rely on professionals we hire to do right but us, don't we?
I closed on a apartment recently- i can tell you that at closing the lenders attorney hit me with so much more to sign that I ordered him to "just make a pile" so i can go through it one by one. ALot of it was nonsense like signing a statement that says my mortgage payment would not create a financial hardship on me, name affidavit, and other disclosures. I told the lenders counsel that i felt like wiping my ass with his paperwork. They thought i was joking.
I'm a seasoned real estate title examiner and sometimes i still get frazzled by it all.
It was TOO EASY for brokers to scam the "general" population into large loans.
why would you get frazzled by it if you are a seasoned title examiner? all the disclosures are required by law, lol. are you in favor of de-regulation?
i think danielle maybe referring to countrywide. several weeks ago, after bank of america bought they pled guilty to predatory lending. they were ordered by court to make the loans affordable for 200,000 - 300,000 customers, estimated to be $8-$9 billion in refinancing/restructering just in the next year or two. $30-$70 billion over the next 10 years as more people demand this.
i can tell you this, my uncle came to me to refinance him. i quoted him and he said his "mortgage guy" could do a better rate and blah blah blah. i told him i would not break any laws to do that. i have several licenses ethically if i do something wrong with 1 the other is effected. his mortgage guy was one of the first people the state of florida went after and made an example of. you can search cape coral, fl to find out more about it you care. i am not sure if he is in prison yet. there was people doing illegal things, but make no mistake his clients knew it was illegal too.
while there may have been a small amount of people who didnt know, the majority knew exactly what they were doing.
Then you must not be poor or a minority. Everything I see is for either of those two groups. Isn't that a shame? Spreading the wealth, baby, spreading the wealth!
why would you get frazzled by it if you are a seasoned title examiner?
save the wit for your buddies. My point was that it took me a considerable amount of time to hammer through everything properly so i can't imagine how difficult it must be for someone who never closed a deal before.
I've worked for a title company for the past 16 years and have closed countless transactions at the table. Mostly commercial.
Yes, it can be a challenge when its not a 150K shack in north carolina.
Quote:
all the disclosures are required by law, lol. are you in favor of de-regulation?
stop the BS. again, i think my point was made. lawyers have to be paid so their mastery in the art of being redundant is not lost on me nor is regulation in the real estate market.
save the wit for your buddies. My point was that it took me a considerable amount of time to hammer through everything properly so i can't imagine how difficult it must be for someone who never closed a deal before.
I've worked for a title company for the past 16 years and have closed countless transactions at the table. Mostly commercial.
Yes, it can be a challenge when its not a 150K shack in north carolina.
stop the BS. again, i think my point was made. lawyers have to be paid so their mastery in the art of being redundant is not lost on me nor is regulation in the real estate market.
i am sorry, but anyone in title should know what they are doing. you had trouble looking at the same documents you've look at for 16 years? you dont have them memorized by now?
i dont even attend closings and i have them memorized, lol.
i think 150k goes a long way in NC. i am not sure where the shack comment is coming from.
1 of the main things i try to explain to clients is double payments. if you cant afford double payments you shouldn't be buying the home. particularly those who want to put zero down or anything under 20%. when you make double payments you can pay a loan off in 5.9 years, amazing isn't it? lol.
EVERYBODY knows what they can afford per month regardless what they want to afford. they know how much they make and can spend. 7 out of every 10 of my clients know thier budgets so well they aren't willing to go outside of it $1. ONCE AGAIN, EVERYBODY KNOWS WHAT THEY CAN AFFORD. There is thousands of mortgage calculators online books, people who are knowledgeable. Rarely is anyone un-informed.
while there may have been a small amount of people who didnt know, the majority knew exactly what they were doing.
I agree 100%. We knew folks buying in the same time frame who took every penny the bank would lend them and now don't own the home anymore (missed foreclosure by a hair and lost $78,000 on the house) They knew what they were getting into, just didn't want to admit it was out of their league.
I think some other folks are foolish and don't know what they can truly afford. They live beyond their means in general and apply the same to owning a home. A few have been victims of fraud, but so few it probably doesn't make a difference in the entire scope of the housing mess we are in.
As for us, we knew what we were getting into as well and in about 4 years we will finish paying our 30 year mortgage after only 9 years. It could be faster if we get any bonuses or pay increases and throw some more $$ at it. Ours is not the biggest house, nor the newest but it is in a great location and I'm not sure we would have been any happier with the bigger house, the house the bank said we could afford, the house we would have have worked every minute for the next 30 years to pay off. I'll be very happy to be done in 9 years. I keep wondering what we will do with the house payment money for the next 21 years!?!? I bet we'll figure something out.
I agree 100%. We knew folks buying in the same time frame who took every penny the bank would lend them and now don't own the home anymore (missed foreclosure by a hair and lost $78,000 on the house) They knew what they were getting into, just didn't want to admit it was out of their league.
I think some other folks are foolish and don't know what they can truly afford. They live beyond their means in general and apply the same to owning a home. A few have been victims of fraud, but so few it probably doesn't make a difference in the entire scope of the housing mess we are in.
As for us, we knew what we were getting into as well and in about 4 years we will finish paying our 30 year mortgage after only 9 years. It could be faster if we get any bonuses or pay increases and throw some more $$ at it. Ours is not the biggest house, nor the newest but it is in a great location and I'm not sure we would have been any happier with the bigger house, the house the bank said we could afford, the house we would have have worked every minute for the next 30 years to pay off. I'll be very happy to be done in 9 years. I keep wondering what we will do with the house payment money for the next 21 years!?!? I bet we'll figure something out.
well good for you. i am really happy to hear this. i do investment properties and people don't understand how i have them paid off. i explain to them the concept of double payment and people are amazed at this and had no idea. even $100 extra makes a difference on any bill. my sister bought a new home in atlanta a little over a year ago and has been making triple payments on her 2nd mortgage and it is almost paid off.
as soon as i get extra cash flow coming in i save for several months all the while looking for another investment. i hope in 5 years i can start to liquidate my properties and lend my money and get that 80% return on it like banks. what a massive amount of profits. i may even just leverage each one while keeping my mortgages at 50% of the cashflow
i am sorry, but anyone in title should know what they are doing. you had trouble looking at the same documents you've look at for 16 years? you dont have them memorized by now?
spare me the BS, please. I know what i'm doing.
I don't care if you've closed 1000 deals.
I go over EVERY SINGLE PIECE OF PAPER. Many lenders and their attorney's have their own style of document preparation and closing. As a broker you should see this. Some closings are more challenging than others for a variety of reasons. This you should know as well.
As title people, many times we have to dot the eyes and cross the t's for the attorneys and their HUDS almost always have errors in them.
I bought a nyc coop and the stock certificate didnt match the proprietary lease which went against the boards rules. Not one person caught that originally. Is that a title issue, NO. Did it throw a monkey wrench in the deal, sure. Did we take the time to fix it on the spot, absolutely.
You should know better than to argue these points with me.
Last edited by BK2Westchester; 10-22-2008 at 12:45 PM..
I agree 100%. We knew folks buying in the same time frame who took every penny the bank would lend them and now don't own the home anymore (missed foreclosure by a hair and lost $78,000 on the house) They knew what they were getting into, just didn't want to admit it was out of their league.
I think some other folks are foolish and don't know what they can truly afford. They live beyond their means in general and apply the same to owning a home. A few have been victims of fraud, but so few it probably doesn't make a difference in the entire scope of the housing mess we are in.
As for us, we knew what we were getting into as well and in about 4 years we will finish paying our 30 year mortgage after only 9 years. It could be faster if we get any bonuses or pay increases and throw some more $$ at it. Ours is not the biggest house, nor the newest but it is in a great location and I'm not sure we would have been any happier with the bigger house, the house the bank said we could afford, the house we would have have worked every minute for the next 30 years to pay off. I'll be very happy to be done in 9 years. I keep wondering what we will do with the house payment money for the next 21 years!?!? I bet we'll figure something out.
I disagree that only a "few" were victims of fraud - are you kidding me? These lenders knew what they were doing, and knew who to take advantage of - people who were not educated about home ownership.
Instead of just lending to them (making a fast buck, knowing the loan would never be paid and the person would lose their home, AND knowing that THEY would never have to worry because they'd sell the mortgage anyway), they should have educated these people first, and not been as stupid as they were (look who we had to bail out!) in lending to someone who they knew could not pay.
They are at LEAST 50% responsible for the mess, if not more. You don't lend to people who can't pay, unless you are trying to be fraudulent. They had the responsibility to be the ones to do the right thing. People who aren't educated, are going to assume that the lender knows what he's talking about, if he lends you $200K! He knows damned well, but he's jerking people around.
Those people are disgusting pigs - the ones who took the loans were not trying to be fraudulent - only the BANKS were. And, then we bail the bastards out. The people who took the loans were acting in good faith. Do you think they'd take a loan, if the banker was honest and said, "look, people, you can't really afford this, but I don't give a ****, and you'll lose your home, but I'LL make some money off of it!" If a banker said that to me, I'd run out of there.
The bankers were commiting fraud, not the borrowers. And, the sick thing is, they knew it!
(P.S. I own my own home and have for 20 years, and have a really good fixed mortgage, so I'm not talking about myself here).
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
