Comments on: Reason #427 Why Self-Regulation Doesn’t Work

By: torgo2009

torgo2009 — Thu, 30 Jul 2009 19:22:42 +0000

The mortgage companies used to (probably still do) advertise you could refinance with no closing costs. That was always a lie. There were always some fees to be paid. I’m an accountant and I’ve seen it all.
I think the worst thing I saw was the prepayment penalties. When we bought our current home we bought it from an estate since the woman who had lived in the house had died. Her two children were handling the sale. At closing the children were shocked and surprised to find that the company the mother had refinanced with had a penalty in the fine print that imposed a 10% early payment penalty. That was nothing short of criminal.
The good thing is most of those companies have folded up but they’ll come back if there’s money to be made.

By: Becca

Becca — Thu, 30 Jul 2009 19:00:29 +0000

Even better: When these poor schlubs go under due to the jacked up fees, charges, and penalties and the vastly inflated balance is finally declared uncollectable, guess what happens?

They get to write it off against their corporate taxes! It’s win-win-win-win… For them.

By: torgo2009

torgo2009 — Thu, 30 Jul 2009 17:20:53 +0000

I agree. The programs some of the states started long before Obama was talking about it have done more but still not all that much.
Since we know with certainty that many modified loans will just default again we need to get a group of concerned individuals (who owe nothing to the lending industry) together and work out a final solution.
One idea is to have a grace period of no payments for homeowners. For it to work it has to be binding on both sides. It should only be offered to people serious about keeping their home.

By: Hugh

Hugh — Thu, 30 Jul 2009 17:14:43 +0000

This is all political kabuki for the rubes. Obama has done nothing for homeowners. Cramdowns, which would help them, are of course off the table. Both of the programs which Geithner announced for homeowners were noteworthy in how small they were and how their main emphasis was on propping up the value of assets on bank books. In other words, they were never about help for homeowners. This is what makes Obama’s jawboning such a sham. It is meant to distract attention away from a crummy program by taking to task one small part of it.

By: torgo2009

torgo2009 — Thu, 30 Jul 2009 17:03:05 +0000

Credit card companies are actually worse than the mortgage companies but of course they deal with smaller dollar amounts. I’ve seen interest at 32%.

By: torgo2009

torgo2009 — Thu, 30 Jul 2009 17:00:56 +0000

Nope, I’m totally an independent thinker. That’s something Progressives gave up long ago.

By: RevBev

RevBev — Thu, 30 Jul 2009 16:56:34 +0000

The “her” was my elderly mother…..some key board trouble here;))

By: RevBev

RevBev — Thu, 30 Jul 2009 16:55:07 +0000

I had horror stories about Bank of America when I was doing stuff for her; the account was only there due to a history of several other bank owners. But I heard a big fee story this week on TV….a charge to close a credit card account!! Whoaaaa.

By: tejanarusa

tejanarusa — Thu, 30 Jul 2009 16:45:23 +0000

What an amazing load of crap.

You believe and spread a myth made up by repub smear merchants.

By: torgo2009

torgo2009 — Thu, 30 Jul 2009 16:31:23 +0000

Nope, that was the mortgage companies.
I remember when I bought my first property in CA in the year 2000. I wanted a 15 year loan. The mortgage was a variable rate (they wouldn’t offer a fixed on this particular property) that started out at 7%…the going rate at the time.
But then the lender said, “Oh no!!!! You don’t have to make regular payments.” “You don’t even have to pay interest only.” “You can just pay 3% annually…and we’ll tack the rest onto the principal.”
I know when I stuck to my guns and demanded a 15 year loan they thought I was just some rube. Many people feel into their trap.
And yes, good ole Barney and his friends put the screws to the lenders to make zero down loans. After a while at least some of our elected officials noticed the zero down loans had a default rate 40% higher than any other category.
The sad truth is Barney is bad for America.