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[quote=BigCountry;1319177]Yes. I lost the 10k incentive (given if I purchased the home with Country Wide). BUT what CW tried to do was cover up the 10k in the 20% APR (it was a 80/20/5). The rate was just crazy...
What.... are you sure it wasn't a 80/15/5? Sounds like someone wasn't being honest. Hey banker, have you heard of a 80/20/5?
yes, but to fix up houses...not for new homes
like 103% or 107% loans. which i'm sure are gone by now.
but i'm sure he meant 80/15/5
[quote=Gosox05;1319391]
Quote:
Originally Posted by BigCountry
Yes. I lost the 10k incentive (given if I purchased the home with Country Wide). BUT what CW tried to do was cover up the 10k in the 20% APR (it was a 80/20/5). The rate was just crazy...
What.... are you sure it wasn't a 80/15/5? Sounds like someone wasn't being honest. Hey banker, have you heard of a 80/20/5?
i guess we have more to worry about!
Joe Mason, an economist
"I would argue that Countrywide is insolvent. Their only asset is their pricing platform, their business algorithm, and that's not working. The next biggest asset they have is the toner for their copiers."
I went with Bank of America vs Countrywide on my KB Home purchase. It was a MUCH better mortgage package. Just an FYI.
Yeah the only thing CW would really offer me is a 80/75/5 and the apr on the 20 was horrific...I did a 30 year fixed on 95% with BoA @ 6.75. CW could not even touch it..
Oh and you are not "locked" in to do anything until you close. And being Sept 25th is your "tenative close date" with the builder, that's plenty of time to shop around another mortgage vendor. BoA needs about 2-4 weeks (4 tops).
You might forfeit any "incentive" if you chose not to use CW but when you really sit down and run the numbers, those incentives are nothing but scams..they are "ammended" in higher interest rates.
Remember nothing is free.
I totally agree with BigCountry. You are not locked with CW until the closing. I also was financing my house with them, they were giving me a horrible packake, 80/15/5 with almost a 9% on the 20. I felt like I had that monkey on my back from the commercial. I called BofA and in one week they had my new loan ready, with a much lower interest and a 95/5. Forget the incentives that CW is giving you, you will end up paying for them in the long run.
Good article...the problem is always with economics- a pseudo science- which cannot be predicted accurately...as the article alluded too, most of the mortgage lenders rely on liquidity from the previous months checks...with a large portion of homes looking at foreclosure, nobody can determine the foreclosure rate, and the related value of this total, and hence, the markets cannot be priced, and so the whole market is stalling, and this could spell doom for single-source mortgage companies...as it seems to have already started...the main point is that it seems as though this whole business will dry up, and revert back to traditional banks, but not until the market has settled, which could be years...in the meantime, builders will go bankrupt, and the jobs and services which they employ will follow, and then those people default, and on and on...the cycle is vicious when it comes to finance, as it has always been a house of cards. Frankly, I think too many people own more house than they need, and hence they can barely afford to make the payments...I have grown up in the construction business in S Fl and have worked throughout the SE, and have never seen more problems than the last 5-7 years regarding unqualified borrowers getting loans...I sincerely believe that the Fed Reserve has made serious mistakes in letting this experiment run amuck, assuming that growth would spur growth and that the expected equity in homes would trickle into the economy and so on...it seems as if the old "25% rule" of home mortgage payment has been thrown out the window and people got used to spending 40-50% of their income on a mortgage...it also seems that with eveybody now being able to pay any bill- electric, cable, taxes, grocery, etc- on a credit card that once were cash only payments...we are simply a country who thinks they own alot as long as they can make that 3% minimum payment, when the reality is that the banks and creditors actually do...just walk through your house and be honest with yourself, and figure out what you actually OWN, 100% outright and then figure it's value vs what you are financing and it's value...I think it would shock most people...I can personally build and live in just about anything I choose...but I have never been interested in keeping up with the Joneses, so I pay cash for most everything, and payoff my credit cards when I can...I just think there is a whole generation of folks(myself included) who don't get it, and they are now running things... and feel no compunction about financing 2, 3 or 4x what they are worth or can afford...JMO
Yeah I agree Gator. The 25% rule is totally forgotten now a days. But it can sometimes be a trap set by the builders.
The whole "base" price thing and the "upgrades" is, in my opinion, a price trap. The things some builders install as the "base" items are absolutely horrible, even in a 1/4 million dollar home. The average buyer is literally forced to drop 10k in upgrades usually just to get sub par lighting/plumbing/electrical/appliances etc. Heck for example I had to pay 1k extra just to have my ceilings flat. The "base" ceilings were popcorn... The base carpet, fossets, etc holy cow man - these things were literally the cheapest items I have ever seen. Some looked like plastic things installed in a 1985 mobile home (no offense to anyone in a 1985 mobile home).. lol
So people think oh, I can def afford a 200k home, that's 25%. But after they get out of this "design" studio they are now looking at a 220-225k home. Because let's face it, noone wants to drop 200k on a brand new house and get crap!
But yeah consumer dept in America (different topic) is thru the roof....people have "credit" but they don't have "cash". At some point all that will catch up and then we are looking, as a country, serious depression..
Heck you ask companies like Lowes and Home Depot what their hottest money maker is ATM and if they are honest they will say "FINANCE". hehe
Last edited by BigCountry; 08-21-2007 at 11:13 AM..
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