Mind you she was being represented by a real estate agent that attended her church who told her that as soon as the house increased in value she could refinance. ...
Two years later the price went down instead of up and she is doing everything she can to work out her loan and stave out foreclosure. The fact of the matter is if t she had qualified for a conventional mortgage at the prevailing rate of six percent instead of the eight and ten percent she was charged she could have afforded the home. The whole premise of subprime lending in which people without a down payment or less than stellar credit ratings are charged a higher interest rate never made sense to me. The lenders say it's because they are taking on more risks however I believe it caused more harm than good. So the question is was this woman victimized or should she have known better? Several states believe that far too many people were charged exorbitant fees on their loans and could have qualified for a conventional loan. States have initiated litigation to force mortgage lenders and banks to rework the loans.
See Bank of America announced "Home Ownership Retention Program for Countrywide Customers". Finally a bailout plan that addresses main street and in my opinion focuses on the root cause of the problem. So the question is if there wasn't wrong doing why have they agreed to the settlement
Comments: (16)
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By: Payday Loan Advocate on 10/17/2008 5:17AM
In autumn of 2006, a bill went through Congress limiting the interest rate of no fax payday loans to a particular group of people to 36%, effectively cutting them off from the service. This bill was strongly supported by both presidential candidates. It took effect October, 2007, amidst bipartisan support. This bill cuts off members of all military branches from access to no fax payday loans, including the Army, Navy, Air Force, Coast Guard, National Guard, and Marine Corps, and other services. An increasing number of our men and women in uniform had discovered that these loans had been taken out in their name, and then defaulted on, accruing interest and penalties, without their knowledge. Some were the victims of identity theft, and some had spouses take out the loans in their name without their knowledge. Many of our servicemen and women are in the lower brackets of income and do not have access to professional financial advice. Obama has been noted for saying that he will attempt to pass legislation putting this cap in effect nationwide for all American citizens. Just keep that in mind that there are threats out there to your right to financial options when you need a helping hand that legally exists beyond banks and credit cards.
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By: Galtney on 10/18/2008 1:48AM
The only reason Your company put this out there is to keep your big money coming in . These types of companies have a very high interest rate and do very few any good . So if you want to help people lower the interest rates on these loans so you can show the people that you all are relly there to help in a time of need instead of taking advantage of them .
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By: Rob on 10/19/2008 9:01AM
As the economy struggles, the thoughts of taking an extravagant vacation seem to be a pipe dream, but there is a way to visit all of the destinations you desire and actually make money doing it. Be your own boss! Travel the world with friends and family! Check out www.AnywhereAnyfare.net right now for more details.
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By: Ansley on 10/19/2008 11:27AM
As a Black woman it is unfortunate to see that once agaain, the African American race is the blame for the economic hardships. On the same token, agreeing to a loan, that you do not fully understand is also unacceptable. Whether for financial issues with your own income or problems with the loans interet rate, the fine print should always be read. It is a binding contract. In a time of need and desperation, I believe that the mortgage companies should negotiate and reconsider plans and contracts with thier valued customer. I just do not see it happening. Billion dollar companies have never "slaughtered" their cash cow in the need of "feeding" the African American race.
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By: Shawn Peay on 10/19/2008 11:28AM
I went to a NACA (National Save the Dream Campaign) meeting and they are a non-profit organization that help's people keep there home's even in forecloser,and they help bring down your interest rate.Call 1-888-302-6222 or www.NACA.com
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By: QSTYK9 on 10/19/2008 12:44PM
ONE OF THE LARGEST MISCARRAIGES OF THE MORTGAGE FIASO IS WHEN YOU GET ALL OF THE PRE CLOSING PAPERS FROM PREDETERY BROKERS AND YOU TAKE THE TIME TO GO THROUGH THEM AND THINGS SEEM OK, THEN WHEN YOU GO TO THE CLOSING, THE BROKERS BRINGS IN A DIFFERENT SET OF PAPERS AND THEY DO NOT INFORM YOU OF THE CHANGES THAT HAVE BEEN MADE. ALL THEY WANT YOU TO DO IS SIGN SIGN SIGN SIGN.... I CAUGHT THREE CHANGES IN MY CLOSING PAPERS AND THE BROKER TRIED TO BLAME IT ON "THE GIRL" WHO DOES THE ADMINISTRATIVES AND HE SEEMED A LITTLE PEEVED THAT I FOUND THESE DISCREPANCIES. (WE ARE MINORITIES) THEY NEGLECT TO INFORM, THAT ONE HAS 3 DAYS TO CANCEL THE ENTIRE DEAL. THESE BROKERS KNOW THAT BY THIS TIME, FIRST TIME HOME OWNERS ARE SO EXITED ABOUT HOME OWNERSHIP, THAT THEY NEGLECT TO GO OVER THE NEW PAPERS THEY SIGNED TO SEE IF THERE HAVE BEEN UNKNOWN/UNSEEN CHANGES. "BAIT AND SWITCH" ON REFI'S, THEY OFFERED AS MUCH AS 150% OF THE VALUE OF YOUR HOME WHEN THEY KNOW THE CITY HAS OVERVALUED YOUR PROPERTY (SO THEY CAN COLLECT A GREATER TAX) AND NOW EVEN THE CITIES AND STATES ARE CRYING BECAUSE THE MONEY HAS STOPPED AND ENTIRE COMMUNITIES ARE BEING ABANDONED (NO TAXES).... UPPER MIDDLE CLASS FOLKS WHO TOOK ADVANTAGE OF THE MARKET WITH NO MONEY DOWN LOANS WERE ABLE TO WALK AWAY FROM THIER HOMES, (AND GO BUY ANOTHER ONE WITH A CONVENTIONAL LOAN) BECAUSE IT WAS NOT AN INVESTMENT, JUST A RENTAL, UNTIL THEY COULDN'T PAY.. THE LOW INCOME FOLKS, WHO COULD HAVE PAID A REGULAR CONVENTIONAL LOAN COULDN'T EVEN WALK AWAY BECAUSE THEY HAD TO HAVE A PLACE TO LIVE. SO THEIR ON THE STREET, BECAUSE OF THIS SUBPRIME FIASO, RENTS ON RENTAL PROPERTY HAD TO INCREASE TO A NUMBER MOST PEOPLE CAN'T PAY.. SO STUCK BETWEEN THE PROVERBIAL ROCK AND HARD PLACE...
SURE WISH I COULD HAVE GONE ON THAT AIG SPA TRIP, I NEED A BREAK TOO...
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By: John on 10/19/2008 1:35PM
I have always believed that saying "buyer beware" and " If it looks to good to be true you're probably right". I think there are a lot of people who don't realize the true cost of home ownership. They think they can afford the mortgage, but no one explains the other costs, such as insurance, property taxes, monthly gas and electric charges to heat and cool a house of the size they are purchasing, and maintenance, will it need a new roof in a few years or new electric or plumbing, ( I heard Joe the plumber has good rates LOL). The bottom line is that the banks should not be allowed to make loans to individuals who's current income will not cover the full cost of ownership. This would prevent people from getting into trouble because 'They don't understand" This would at least help prevent this catastrophe from repeating itself in the future but unfortunately does nothing to fix the problem now. As much as I would like to see everyone in there own home, not everybody is ready for it.
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By: B. Tucker on 10/19/2008 6:47PM
This assult on unspected home buyers was calulated. It all stems from the Saving & Loan scandel.
Point in fact: whenever I tried to get a 15,ooo.oo loan I was denied. The least I could get from any lending instution was 50,000.00.
Also, I asked for a fixed rate. The rate was quoted as 6.25%. However, when the contract was drawn up the rate started at 6.25% and going to 24%.
I was told the money would be available after signing the contract. However the money had already been placed in my checking account. When I questioned the 24% on the contract, I was assured by the bank that as soon as I used the money they would correct the contract to reflect the fixed 6.25% rate.
The banker kept telling me not to worry, just sign the contract.
Being the the money was already in my checking account, I wrote out a check for 50.000.00 and paid them that day before leaving the bank.
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By: Marie on 11/10/2008 8:15PM
The bottom line is people should read their paperwork, and don't sign anything that is not what you expect. Never think the terms will change from what's in writing based on someone's verbal agreement. If it is so, they will be willing to put it in writing. Most people made mistakes and had no business signing these loans and that is the bottom line. People made mistakes. In some folks defense, I know they did not expect for the value of property to drop so low, but again, they signed the loans.
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By: Karen on 10/20/2008 1:09PM
I was doing a lot of loan closings as a Notary from lenders across the nation. I saw so many lenders draw some buyers in with the phrase, "you can refinance in to a fixed rate in 2 yrs" (it could vary from 2 to 5 yrs on a fixed then went to a variable.) Some of these lenders were accepting handwritten statements attesting to the person's employment. I saw a lot of Hispanics, Blacks and other ethnic groups receiving these type of loans. I refused to do closings for quite a few lenders because of their unethical practices. As a Notary I couldn't express my views or give advice. So many Realtors and Mortgage companies/Lenders took advantage of the people that only wanted a place to call their own. I don't blame the people that were buying as they didn't know what the lenders were doing was corrupt and how it would affect them later.
I feel the government bailing out some of the very lenders that were screwing, and yes they were screwing the people, is morally wrong. If the government wants to help then help the people that it is affecting directly with a lending institution that has excellent morals and scruples so these people can maintain their diginity and homes.
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