A judge rules that they were victimized by predatory lenders

16 years ago

Excerpt:

"....According to court papers, a broker Liberty Capital Mortgage in Pennsylvania told the Shearons they would qualify for traditional loan products with fixed interest rates.

But despite their modest income and relatively good credit, the Shearons were improperly pushed into a high-interest subprime loan, their attorney argued. The couple ended up with two mortgages for $71,000 and $284,000. Payment on the latter adjustable rate mortgage has since jumped from $1,800 to $2,500. The first mortgage is set at 10 percent interest rate over the life of the loan.

TRIED TO BACK OUT

Attorney Noah Pusey said his clients tried to back out of the deal before closing but were told they'd lose their $5,000 deposit. They'd also given up their apartment lease and were worried they'd have no place to go with their three children.

"David Shearon was a victim here and he was preyed upon by the bank and their representatives and the brokers," said Pusey, a lawyer with Cilmi & Associates.

Judge Maltese determined the original lender violated banking law by failing to check the Shearons' income and ability to pay the high-cost loan. He said the lender crossed the line again when it financed the home above the $335,000 sale price, using an additional $19,145 to pay the costs and fees associated with securing the high-cost loan. The Shearons' $5,000 deposit, meanwhile, was never deducted from the ultimate $355,000 in financing.

"This ultimately left Shearon with negative equity in the property," the judge wrote...."

Here is a link that might be useful: Island couple fights off foreclosure

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Comments (34)

qdognj
16 years ago
last modified: 9 years ago
Logic, are you sure you're not really John Edwards, noted Ambulance chaser,err attorney, protector of the those who can't protect themselves?
logic
Original Author
16 years ago
last modified: 9 years ago
LOL! BTW, still waiting...(foot tapping).
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You guys misunderstood. Gammyt meant the processed meat, thinking this was a recipe forum. Eventually the lender will come up with something so this really just delays the inevitable. Another tactic is to file a dispute when the bank dings your credit. The credit agency is not supposed to allow a derogatory under dispute. I have a friend trying this for some income property and the credit bureau is saying itÂs between her and the lender. The ding remains. Whether this does anything or not, again, it wonÂt change the ultimate outcome.
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Well, after 3 closing times set and canceled at the last minute, 2 contract extensions, dozens of phone calls and not a few tears, it appears the deal is disintegrating. Not completely dead yet, but definitely on life support. After all is said and done either way, I can feel free to post more detail, but suffice it to say, some of the parties involved appear to have been less than truthful about where things stood. Right now, about as discouraged and emotionally exhausted as I've ever been. I can only imagine how the buyer must feel as well. A bunch of our stuff is now in storage in anticipation of moving, because we were moving to temporary quarters while we build. Including many of the "decor" items that dressed up the house for staging purposes. Plus, the storage is an added expense which we really weren't planning on without selling the house. So, not sure what to do about that now that it looks like we may be back to square one. The saving grace is that our realtor absolutely insisted on negotiating a "possession after closing" into the contract, just in case, so that we would not move before closing and then be stuck. I hate this.
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Here's a story from that time period that is also worth reading. History continues to repeat itself! The Limits of Madness by Martin D. Weiss, Ph.D. 12-01-03 For the first time in many years, I was speechless. I didnât know what to say. It was Thursday evening, on Thanksgiving. My wife Elisabeth, my son Anthony, plus other family members stood around the dinner table, gazing at me patiently, waiting for me to open my mouth. But I was mute. My problem was simple: Elisabeth had asked each of us to say a few words about what weâre thankful for. But by the time my turn came around, all the more important things in life ï¿½" health, happiness, and love ï¿½" had already been covered by the others. Little did they realize, during those moments of silence, that a torrent of thoughts was flashing through my mind, most of which I will share with you now â¦ THE TRUE PESSIMISTS Some people on Wall Street seem to think Iâm a die-hard pessimist ï¿½" that I have nothing to be thankful for. They call me a âperma-bearâ for ânever recommending stocksâ or âChicken Littleâ for âpredicting one disaster after another.â Well, I have news for them: Iâve been recommending stocks throughout the bear market and throughout the recent recovery. The main difference is my stocks went up; most of theirs went down and are STILL way down from their peaks. As to the disasters ï¿½" the dot.com bust, tech wreck, bankruptcy crisis, accounting scandals, and broker scandals ï¿½" guess what! They happened. But thatâs all water under the bridge. Right now â¦ LOOK AT WHAT THE âOPTIMISTSâ ARE SAYING! The so-called âoptimistsâ say Fed Chairman Greenspan will continue holding down interest rates, and Congress will continue spending us into prosperity. They say no one has to worry about ï¿½" or deal with ï¿½" the ballooning federal budget deficit, the record trade deficit, or the huge debt burden of millions of consumers. They think the sinking dollar is âno big deal,â and we should âjust let it fall.â They donât seem to give a darn that your interest income has been reduced to a pittance. Nor do they seem to care very much about the havoc inflation can wreck on your retirement. They tell you ânot to worryâ about the threat to your Medicare or the danger to your Social Security ï¿½" let alone to the other retirement benefits that were promised to you. Worst of all, they seem to think thereâs no significant connection between the shaky pillars of our economy and the equally shaky pillars of our society ï¿½" falling educational standards, deteriorating public health, broken families. And they say âMartin Weiss is a pessimistâ?! Give me a break! WHY I AM REALLY A DIE-HARD OPTIMIST A few seconds had gone by, and I could smell the Thanksgiving dinner spread out before me on the table, still steaming from the oven. Anthony looked at me expecting a profound ï¿½" or humorous ï¿½" statement. But I kept my words to myself and pursued my thoughts in silence â¦ I am an optimist because I love my country. Yes, I see trouble ahead, but I disagree vehemently with the idea that our society is going down the tubes. All of the trends we are witnessing today ï¿½" fiscal irresponsibility, massive debt build-ups, and social malaise ï¿½" are part of a single, growth-at-any-cost megatrend. But theyâre coming to a head. And when they do, we will confront them. We will resolve them. And we will move on to better and safer times. Admittedly, we are half mad, always pushing ourselves to extremes, to the limits of our technological and economic capacity. This week, for example, the U.S. Commerce Department announced that the economy spurted forward at a breakneck speed of 8.2% per year ï¿½" a phenomenon largely driven by government tax cuts and spending. Sounds great, right? But at the very same time, Moodyâs, one of the worldâs leading credit rating services, announced that, if our government continues cutting taxes and spending without restraint, the United States of America could lose its triple-a credit rating! Thatâs not good. Not even close. THE LIMITS TO OUR GOVERNMENTâS MADNESS Fact is we are NOT on the right path. But there is a LIMIT to how far we can go down this path, and, sooner or later, we WILL reach that limit. Thatâs when we will rise to the occasion, make the sacrifices, and move on. Take the budget deficit and inflation, for example. In other lands and in previous times, deficits and inflation could run amuck, almost without limitation. Kings or queens ï¿½" presidents or prime ministers ï¿½" had almost unlimited power to temporarily inflate their economies. They could print paper money to their heartâs content. They could destroy their currency, drive millions of citizens into abject poverty, invite wars of ruin â¦ even threaten the world. Youâve probably heard the stories about the German hyperinflation during the Weimar Republic, before Adolph Hitler rose to power. Thatâs when it took three TRILLION German realmarks to buy just one U.S. dollar. Thatâs when their paper money was so utterly devalued people needed wheelbarrows to cart their cash around. Once, a man parked his wheelbarrow of money in front of a store while he shopped. When he returned, he was shocked to discover that it had been stolen. More shocking, however, was the fact that all the money bundles were left behind, stacked neatly on the ground. Even the thief knew that the wheelbarrow had more value than the worthless bank notes. Plus, last week, I told you about the currency destruction that I personally experienced in Brazil as a young boy ï¿½" and how, over the years, their money was devalued by a factor of one quadrillion (a thousand trillion) to one. These are vital lessons from history we must learn, and we seem doomed to learn them the hard way: Our government today is running up its debt at a rapid pace, just like the previous governments of Brazil and pre-Nazi Germany. Our leaders seem willing to sacrifice our strong dollar in order to keep the people happy and stay alive politically, much like the leaders did back then. But, as I also told you last week, the United States is not Brazil. Nor is it Weimar Germany. Indeed, there is one, all-important, structural difference that separates those episodes of hyperinflation from the United States of today: THE DEBT MARKET Unlike Brazil and Weimar Germany, we have a huge, powerful, fully developed debt market. They didnât. A debt market is where investors buy and sell government bonds, corporate bonds, mortgages, bank loans, and other debts ï¿½" much like investors buy and sell stocks. As in any market, when sellers are more numerous or aggressive, prices go down. When buyers have the upper hand, prices go up. You probably know this already. But bear with me. You may not be aware of its ultimate implications. The primary hub of our huge debt market is downtown Manhattan ï¿½" in the large, cavernous trading rooms of major broker-dealers and banks like Merrill Lynch, Salomon Smith Barney, J.P. Morgan Chase, Citigroup, Credit Suisse First Boston, and a few dozen others. Plus, thereâs a secondary hub ï¿½" in Chicago. Between Jackson Boulevard and Van Buren Street, the Chicago Board of Trade runs a 32,000-square-foot trading floor where, every day, they buy and sell futures contracts representing billions of dollars in U.S. government debt ï¿½" Treasury bonds and Treasury notes. About nine blocks to the north-northwest, the Chicago Mercantile Exchange operates two state-of-the-art trading floors for futures on Eurodollar deposits, Treasury bills, and other debt instruments ï¿½" also with billions of dollars changing hands each day. My point is this: The U.S. debt market is not just a small entity that exists on the periphery of our society. Itâs embodied in massive, tangible structures of concrete, marble, steel, and glass â¦ housing tens of thousands of staff â¦ and handling far more money than all the worldâs stock exchanges put together. Every day, millions of investors ï¿½" individuals, companies, cities, states, pension funds, universities, churches, and foreign countries ï¿½" buy and sell the debts in these huge markets. And every day, the market value of these debts goes up or down, depending on the supply of new debts being offered â¦ depending on the willingness of investors to buy them â¦ or â¦ contingent on the zeal of investors to get rid of their old ones. This goes far beyond the realm of money and finance. The debt market ï¿½" particularly the market for U.S. government bonds ï¿½" also serves as a de-facto POLITICAL FORUM, a place where U.S. government officials must ultimately answer for their sins. How? Itâs similar to what you saw recently in the stock market. Remember how wayward CEOs and CFOs faced their day of reckoning? Remember what happened to THEM when major accounting scandals were revealed? Investors dumped their shares like hot potatoes. Almost immediately, the companies either changed their ways or were smashed by the market forces. Heads rolled. Some CEOs were even marched off in handcuffs. A similar fate awaits wayward officials of the U.S. government ï¿½" but for them, it will be in the bond market. Sounds bad, doesnât it? But actually itâs a very good thing. Because it means there IS a LIMIT to their madness. You see, in other eras and other places, if you were unfortunate enough to lend your money to a reckless, irresponsible government, your choices were minimal: Youâd usually have to wait years until the bond matured. Then, if they paid you back in worthless money, tough luck! Unless you wanted to join a revolution, there was really nothing you could do about it. Today, thanks to the giant debt market, itâs another story entirely. FIRST, YOU DONâT HAVE TO WAIT. If youâre angry as all heck about the ballooning federal deficit, the threat of inflation, the sinking dollar, Medicare, Social Security, and anything else for that matter â¦ or â¦ if youâre worried the clowns in Washington are going to stiff you with cheaper money â¦ you donât have to just sit around and gripe about it. You can sell your bonds and get all or most of your money back at almost any time, almost any day. SECOND, POLITICS IS NO ISSUE. You donât have to hire a lobbyist. You donât have to run down to Washington to bang an angry fist on the desk of some faceless bureaucrat. You donât even have to wait for the next election. All you have to do is pick up the phone, call your broker, and utter one four-letter word: âSell!â THIRD, THE CENTER OF POWER HAS SHIFTED. Millions of people own bonds today. They own them directly in their IRAs, brokerage accounts, or trust accounts. Or they own them indirectly through a mutual fund, an insurance policy, a pension fund, or even a bank account. Any one of these investors or institutions has the power to utter that same four-letter word. SELL! This is so, so important. If you get nothing else out of my weekly âMartin on Monday,â you must get this. Because it means that â¦ THE ULTIMATE POWER TO DECIDE THE FATE OF OUR COUNTRY HAS BEEN TRANSFERRED FROM THE HANDS OF POLITICIANS INTO THE HANDS OF MILLIONS OF PEOPLE. THANK GOD! This ultimate power is more powerful than laws, even more powerful than the now-defunct gold standard which, in the old days, used to restrain how much paper money governments could print. And if youâre thinking the American people have never exercised that power, think again! THE GREAT BOND MARKET REBELLION OF 1980 The president was up for re-election, just as he is now. The economy was shaky, much as it is today. Except â¦. instead of a Republican in the White House, we had a Democrat ï¿½" Jimmy Carter. Whether Democrat or Republican, however, you would have expected him to do everything in his power to pump up the economy, make the people happy and get himself re-elected, right? Youâd think heâd do very much the same kinds of things President Bush is doing now, right? Indeed, the LAST thing youâd expect from Washington ï¿½" then or now ï¿½" is a hard right jab to the underbelly of the economy. Yet thatâs exactly what Carter gave us. He called in Fed Chairman Paul Volcker. Volcker slapped Draconian controls on virtually all forms of debt and credit created in America. They imposed stiff controls on credit cards, making it difficult for the average cash-poor American to spend a dime. They slapped controls on bank lending and business borrowing, making it hard for most companies to invest, hire, or buy raw materials. They even slapped controls on money market mutual funds, making it impossible for them to sell any more shares in existing funds. Within just a few short weeks, the economy was plunging. Gross national product nosedived. And Carterâs chances for re-election were forever doomed. Ronald Reagan became our next president. And the rest is history. âBut why,â you ask? What invisible, mysterious force could have possibly driven a Democratic president â¦ up for re-election just months away â¦ desperate to pursue his vision of the world for another four years â¦ to suddenly and deliberately sabotage an already-shaky economy? Was he possessed by aliens from outer space? Did he go bananas? Not quite. Hereâs how it happened: In 1979, the government was pumping up the economy with easy money and rampant government spending. Inflation was heating up. So, millions of people who had invested in U.S. government bonds were spooked â¦ and angry. They called their brokers. They uttered that powerful, four-letter word. And the market price of U.S. government bonds ï¿½" especially long-term bonds ï¿½" crashed. It all came to a head in February of 1980. The Soviets had invaded Afghanistan. There were rampant fears of another expensive arms race. Inflation was soaring into double digits. And the bond market crashed again. In desperation, a delegation of major New York bond dealers ï¿½" including Merrill Lynch and Salomon Brothers ï¿½" made a pilgrimage to the White House. A few hours later, a dozen powerful Wall Street men in three-piece suits sat before the president in the Oval Office. I donât know exactly what they said, but hereâs the gist: âWe have a message for you,â they declared to Carter. âThe message is from the millions of government bond investors in America and all over the world. You know ï¿½" the people who have been loaning you the money you desperately need to run this country.â âOh, really?â Carter asked solemnly. âWhat are they saying?â âTheyâre saying theyâre fed up with the governmentâs reckless spending and with the inflation thatâs destroying the value of their bonds. Theyâre saying theyâre not patsies and they wonât sit back passively when theyâre paid back with worthless dollars. Their message to you is simple: âEither you end the inflation now ï¿½" RIGHT now ï¿½" or weâre not lending you any more of our money.ââ Carter was stunned. âIs it really that bad?â âNo. Itâs worse. Now, these investors arenât just refusing to buy your new bonds. Theyâre also SELLING back the OLD bonds they bought previously â¦ dumping âem on the market in torrents. That drives their prices down and the interest rates you have to pay through the roof! Thatâs why your 30-year Treasury bond has plunged to a meager 50 cents on the dollar! Thatâs why youâre going to have to a whopping 13% interest for long-term money, over 16% for short-term money!â Carter still didnât get it. So the delegation from Wall Street explained further. âLook! Your Treasury bonds are crashing in value. No oneâs buying âem and everyoneâs selling âem. Weâre having trouble selling even a small lot of $5 million. Itâs getting so bad, bond dealers like us are getting ready to quit.â âWhy should I care?â âBecause you canât survive without us. We are the ONLY ones in the world who can sell your bonds to the public â¦ to raise the cash you need. And now WE ARE SHUTTING DOWN. Weâve lost so much money holding inventories of your Treasury bonds weâre running out of capital. We canât afford to be your dealers any more. Weâre going broke!â âBut what do you want me to do?â âYouâve got to stop the value of the dollar from falling, end the inflation ï¿½" even if that sabotages the recovery.â âBut what about the election next November?â Carter asked under his breath. âForget about next November. Unless you can convince bond investors that youâre going to end this inflation, you wonât be able to borrow the cash you need to meet government payroll next WEEK! The entire government will have to shut down ï¿½" right now.â THE NEXT BOND MARKET REBELLION Finally, Carter got the message. And thatâs when he gave Fed Chairman Volcker the green light to do whatever he needed to squash the inflation ï¿½" even if that meant squashing the economy too. Can something like this happen again? You bet it can! Fast forward two decades and three years ï¿½" to December 2003. Once again, government spending is running amuck â¦ Once again, Wall Street is beginning to worry about the consequences (remember what Moodyâs has just announced!) â¦ Once again, bond investors are getting ready to start selling â¦ And when they do, GOVERNMENT BOND PRICES WILL CRASH AGAIN! Ultimately, the president and the Fed Chairman will face the same stark choices that Carter and Volcker did in 1980: Stop the fiscal madness â¦ or â¦ shut down the government! I have no doubt they will choose the former. I am also very hopeful that it will be just the first of many steps to confront and resolve the Medicare crisis, Social Security crisis, and others that loom in the not-too-distant future. But alas, our leaders will probably not start to make the right choices until AFTER theyâre up against a major, life-threatening crisis. Thatâs the nature of the beast. They push it to the limit, and then they change their ways only under extreme duress â¦ * when inflation is already surging toward double digits â¦ * when the dollar has been beaten down to painfully low levels â¦ * when foreign investors are dumping their U.S. investments by the boatload â¦ * when sky-high interest rates are strangling the U.S. economy â¦ * And when the bond market has been beaten down so dramatically, the market mechanism itself is on the brink of shutting down. Itâs a frightening, maddening scenario. But be thankful that there is a limit to the madness. It WILL end ï¿½" and for the better. In the meantime, be sure youâre protected ï¿½" And hold onto your hat. Itâs going to be one heck of a ride. " A link that might be useful: www.moneyandmarkets.com/the-limits-of-madness-8841
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The Ancient Rule of 90%
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Comments (57)
Igloochic, I can't understand the reaction you are having to this thread or the things you are saying to me. There has clearly been a nerve hit touched on here for you and on that level I'm sorry. Some of the thread probably DOES sound or even IS preachy. When people discuss important and polarizing subjects particularly in print where the nuance of real conversation is lost I think things do sound very black and white. I wanted to respond very specifically to your statements to try and avoid any confusion. "I often put myself in the position of the people being bashed and think....how would it feel to know that my kd was posting on an open forum that I missed the boat on my kitchen. That is where I came from when responding to this thread. I feel really awful for those clients who probably love their three ovens. I guess I'm not implying so much that you aren't a good designer, but that what you said wasn't very nice and did a disservice to your clients. Can you see how it might knock the silly little smiles right off of their faces?" My clients already KNOW that I would have traded the plumbing for the third oven. I certainly wouldn't have said such a thing on a public forum if it was a secret. I was not saying or even implying that their choice was a bad choice. I was using it as an example of two people having a different measure of 90%. It is also true that the client, a personal friend, frequents this board and I fully expect it to make her laugh her ass off. I'll be deeply disappointed if she doesn't notice it and be forced to point it out to her. She has herself been insisting I point it out when she posts her final kitchen pictures. This particular client has never worn a "silly little smile" and I was then and now applauding her choices. "Your analyzation of the cost of the tv was frankly so ridiculous it was self serving to arrive at the conclusion you wanted to arrive at. A room must be built, the price raised a couple of grand, replacement in three years etc. You didn't want the tv, end of story. Your husband wanted the tv in the existing space. The excess in that case was not in the wanting so much as in the analysis of the person who didn't want the silly thing." I think here you may have misunderstood the analysis I was running. I was not comparing my husbands dream tv analysis with anything. I was making a comparison against what laxsupermom's family had against what I rated in my 90%. I used it to point out that what might very well be in the 90% of a different life style is not so for me, trying to emphasize that each of us will draw a different line in the sand. (at least one number WAS off in the calculations. My husband pointed out after he read the post that often we have to spend 25 dollars instead of 16 on tickets to a 3D movie) So my numbers, if you had percieved me to be talking about my husband wanting a tv would have seemed outrageous. But I think applying those numbers to an 82" tv in the media room Lax mentioned are not bad for having been done off the cuff. Beyond that I can only tell you my personality. I am a stark raving lunatic and if I was against the TV I would just SAY I was against the tv. Seriously. My husband would mention it and instead of talking it out I'd just laugh my ass of and tell him to keep dreaming. "The thread then further goes into how grand and wonderful everyone is for not giving into their wants....I am glorious in my self denial etc aside from a few who chimed in to say your thought process on the issue was possibly flawed. Then the standard ugly American bashing moves straight to how green we are. It's just not a very pretty read I guess and I shouldn't have responded late. Sorry about that." I don't disagree with you that there is certainly some negative things implied (or even said!) when people talk about cutting back on financial expense. Theres an implication that those who don't should be viewed in a negative light. Similarly, a thread about buying whatever you want may cast those who chose to buy less as putting hard workers out of jobs or being weirdos. (and indeed, one person did say that he felt it was an american issue. But then several chimed in that they weren't sure that it was an american issue. So I'm not sure if I read the thread as a total being that way) Either way, I have no control over posts that are not my own and work very hard to keep my posts polite and straight forward. There is no reason to have animosity towards me for posts that are not mine. What I think is happening with you and I may just be that I didn't explain well that the issue was never about the tv. The tv my husband asked for would have equated to almost 4 months of salary and was never seriously on the table. He knew it, I knew it. But since I didn't think of this thread as about that tv (and wanting to be slightly more discreet in discussing my finances) I didn't make that clear the way I should have. (also, I didn't make it clear that I am a tech geek. I would happily have a new huge tv every month if I could work it into my 90%) Then, when I used that larger tv as a comparison I did it in a confusing way so that several people believed I was talking about my DH's when I was not. If I could go back I would change the percentage to 98%. Perhaps that would have more fully shown that I am totally absolutely supportive of getting things simply because they bring you joy. I cannot support the idea that if you want something then affordability is the only criteria but I really wasn't trying to post about that. For me, this post was more about looking at the real costs behind the items before making the purchase and understanding that because the neighbors 90% includes a boat doesn't mean your 90% has to be the same. Indeed, your 90% may be a yacht. I hope I've more fully explained what I was trying to say and maybe more importantly put across that I wasn't bashing my client. Just trying to pick a choice that we'd all be familiar with. This is now officially the longest post I've ever done on GW. Just so you know.
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qdognj
16 years ago
last modified: 9 years ago
waiting for.................????
logic
Original Author
16 years ago
last modified: 9 years ago
Ah..how easily we forget...

If you really need a refresher..read my posts in the 60 minutes thread again..and you will see. :-)
hobokenkitchen
16 years ago
last modified: 9 years ago
Logic; can you keep all this stuff in one thread instead of spreading it everywhere. Other posters may have important questions about their own situations which are being knocked off the page by all the new threads on the same subject that you are starting.

There will be a lot of cases like this as there should be. I do hope you don't plan to start a new thread for each one!
logic
Original Author
16 years ago
last modified: 9 years ago
Apparently you neglected to read who posted this threadwhich is, in case you did not realize, printed under the thread title.

That or, you have yet to figure out how to ignore threads that are of no interest to youÂÂ.instead, expecting others to confine their posts to only those that meet your particular area of interest and approval.

That said, you may want to look in to starting your own forum, if controlling content is that important to youÂpeople do so all of the time so I canÂt imagine that it is all that difficult.

Best wishes with your endeavors.
qdognj
16 years ago
last modified: 9 years ago
i have no idea what you asked, even after rereading most of your drivel...lol
kathyg_in_mi
16 years ago
last modified: 9 years ago
Hmmm, and I thought John Edwards is a psychic(sp)!
Kathy G in MI
dreamgarden
16 years ago
last modified: 9 years ago

Logic-I appreciate your posts about the subprime mortgage problems, they most certainly ARE relevant to this forum, so please keep posting them! Don't suppose you happened to catch that story in Travel and Leisure magazine last year, did you?!
It might explain why certain other posters feel the need to make political slights or play 'forum moderators' when they don't have anything of value to add.

A link that might be useful:
www.philly.com/philly/hp/news_update/10664037.html
word_doc
16 years ago
last modified: 9 years ago
Team Logic-- based solely on how he/she continues to argue the issue and not take potshots.
logic
Original Author
16 years ago
last modified: 9 years ago
Thanks dreamgarden, great link...and great point.

I figured that there are those who read this forum that are also caught in this mortgage mess or know someone who isand may therefore appreciate knowing of cases where others have prevailed....

....so, IMO, its important to make it easy for them to find as opposed to burying it in a pre-existing thread to appease those who have no interest (or, wish to remain in denial as the case may be) don't have to see it and give in to the uncontrollable "urge to click". ;-)

Also...isnt it odd that anyone who frequents this forum does not yet "get" that those posts that hold little if any interest, scroll down very quickly if no one clicks?

qdonj, ROFLOL....as you have no idea what I asked, I can only assume that is why you have missed the point (be it accidentally of on purpose) in just about every response you have made to my "drivel".

Kind of like those borrowers whom you continually bash for having no idea what THEY read.
People in glass houses.....

Mystery solved. :-)
dave_donhoff
16 years ago
last modified: 9 years ago
<_sigh>....
Another poster-case for the value of retaining a Fee-Only Mortgage Broker (aka Transparent Wholesale Broker, and/or Up Front Mortgage Broker.)

There are never any "disclosure" issues with Fee-Only brokers, because the client is fully aware of every issue involved.

Cheers,
Dave Donhoff
Strategic Equity & Leverage Planner
FatHen
16 years ago
last modified: 9 years ago
Logic, I also feel this topic is very relevant to home buying/selling! Some people may think this would never happen to them, and may be viewing people in foreclosure as deadbeats, but there were people who were victims of fraud. Fraud always evolves faster than the consumer-info designed to warn people or prevent it.
logic
Original Author
16 years ago
last modified: 9 years ago
Thanks fathen...and it indeed so true that "Fraud always evolves faster than the consumer-info designed to warn people or prevent it."
qdognj
16 years ago
last modified: 9 years ago
fathen, i can't recall ANYONE saying there are not victims of fraud, surely this did happen...BUT, a significant # of these people can only blame themselves for not realizing what could happen to them if rates increased..No sympathy for those people
qdognj
16 years ago
last modified: 9 years ago
dreamgarden, i find it somewhat ironic that you believe that the "industry" is to blame, and not hold signers of these mortgage products responsible..It was YOU who months ago replied to a question of whom to trust with the following:

I trust lots of people, my family, close friends, some neighbors. However, when it comes to financial matters DH and I feel the same way beachlily does, "We only trust ourselves to make financial decisions that involve our own money. Period."

It's what you don't know, that can hurt you. If you are interested in advice about how to pick a planner, you might want to pick up a copy of the following book at your local library or bookstore

If this is true, how can you blame the industry solely for this unfortunate mortgage debacle? Shouldn't people be as diligent as you and DH ?
dreamgarden
16 years ago
last modified: 9 years ago
Logic-Have you see this article? Talks all about how it is ONLY the borrowers' fault for the subprime mess and NOT the lenders, banks, etc!

Fed taking on abusive lending practices

By JEANNINE AVERSA, AP Economics Writer
Dec 15, 2007

People taking out home mortgages may gain new protections soon against shady lending practices as the Federal Reserve seeks to back even the riskiest borrowers, already hit hardest by the housing and credit crunches.

Rules expected to be proposed Tuesday would apply to loans made by all types of lenders, including banks and brokers. The plan from the Fed, which has regulatory powers over the nation's financial system, could be finalized next year. The effective date would be know then.

The Fed is considering:

_barring lenders from penalizing subprime borrowers ï¿½" those with spotty credit or low incomes ï¿½" who pay their loans off early.

_forcing lenders to make sure that borrowers, especially subprime borrowers, set aside money to pay for taxes and insurance.

_restricting loans that do not require proof of a borrower's income.

_examining lenders' failure, in some cases, to consider a borrower's ability to repay a home loan.

_improving financial disclosure so people better understand the terms and conditions of their mortgages and get this information when it is most useful.

_curtailing abuses in mortgage advertising.

"We have an obligation to prevent fraud and abusive lending," the Fed chairman, Ben Bernanke, said earlier this year. "At the same time, we must tread carefully so as not to suppress responsible lending or eliminate refinancing opportunities for subprime borrowers.'

The issue has taken on heightened importance given the meltdown in the housing and credit markets that has led to record numbers of home foreclosures. The crisis has raised the odds that the economy might fall into a recession, roiled Wall Street and has given Democrats and Republicans much fodder to blame each other.

On prepayment penalties, consumer advocates say these deter homeowners from refinancing on more favorable terms. Those penalties can be hard on borrowers who want to get out of adjustable-rate mortgages that reset from a low introductory rate to a much higher one they have trouble paying off.

Mortgage industry representatives say prepayment penalties ensure that lenders receive a minimum return if loans are paid off early. They also say people with mortgages that include such penalties often get a benefit of lower upfront costs or lower interest rates.

Of the nearly 3 million subprime adjustable-rate loans surveyed by the Mortgage Bankers Association from July through September, a record 4.72 percent entered the foreclosure process during those months. At the same time, a record 18.81 percent of the subprime adjustable-rate loans were past due.

When home values weakened, borrowers were left with loans balances that eclipsed the value of their homes. They also were clobbered when their loans reset with much higher interest rates.

As for the idea of setting aside money to cover taxes and insurance, consumer groups worry that subprime borrowers do know about these expenses or might not be able to budget for them. These groups also have raised concerns about lenders quoting subprime borrowers monthly payments that do not include taxes and insurance costs.

The Mortgage Bankers Association has some problems with mandating escrow accounts ï¿½" where those costs specifically are set aside each month ï¿½" for borrowers. The association does support efforts to make sure borrowers have the appropriate information about their obligations to pay taxes and insurance.

The Fed says loans to subprime borrowers typically do not include such an account, while loans to people with better credit and lower risk to the lender usually do.

The central bank also says that lenders sometime will make a loan without documenting or verifying a borrower's income. Lenders may charge higher rates for such loans, the Fed says.

Mortgage lenders say these loans are appropriate for many borrowers, including those who are self-employed and cannot easily document their income. Consumer groups say many borrowers who could document their income are not aware they are getting a loan at a higher interest rate. These loans are sometimes called "liar's loans" because critics believe they can be used to perpetrate fraud.

Majority Democrats in Congress have been vocal in urging the Fed to act against abusive practices.

Massachusetts Rep. Barney Frank, chairman of the House Financial Services Committee, and other House Democrats said in a recent letter to the Fed that tougher rules are overdue and "needed to help eliminate the kinds of predatory lending practices that exacerbated the current subprime lending crisis."

The House has passed legislation that would put into law some of the same actions the Fed is considering. A similar bill is pending in the Senate. Supporters are heartened the Fed is moving ahead because they think the Fed might be able to finalize action before Congress does.

___

On the Net:

Federal Reserve: http://www.federalreserve.gov/
logic
Original Author
16 years ago
last modified: 9 years ago
dreamgarden: "Logic-Have you see this article? Talks all about how it is ONLY the borrowers' fault for the subprime mess and NOT the lenders, banks, etc!"

Did you cut and paste the article that you had intended to post?

I ask because maybe because it has been a long day I'm not quite seeing where the blame is being placed only on the borrowers in the above article, as it seems to be basically outlining measures being considered to prevent fraud and abusive lending that should have been in place long ago to protect buyers...
..what am I missing?
mariend
16 years ago
last modified: 9 years ago
No matter what a person posts, it is up to us to evaluate the topic. We do not have to be so negative to everyting. If you do not like it, just ignore and go on. Yes there is a lot of fraud, mis-information out there and many of us are not equiped with the complete knowlege of rules and regulations to interupt all the garbage we have to sign to buy anything. I know in my case, if it was not for my DH reading everything before we sign, I would have got stuck big time, and I am retired banker.
So again thank you all for bringing anything to us about saving money and to the others--either contribute something worthwhile or ????
hobokenkitchen
16 years ago
last modified: 9 years ago
mariend; i'm sorry that you do not see the value on the other threads that all of us have been putting forward. Perhaps it is only logic's view that is of value. Of course it is nice for people to be able to sit back and blame 'big business' for their mistakes.

I don't see how the above saves you money, but if you would like to post a question about the best kind of mortgage to go for, and how to actually save money I am sure people will be delighted to help.

I'm just tired of the one sided information being posted by logic. There is much to learn and the articles are interesting, but there is more to this story than logic wants to let on and that is what we have been saying on other threads. Then she just starts another thread, and another and another.

If you are saying that as a retired banker you could not ask a question about what your mortgage rate is, what the payment is and if it changes in the future, then hmm. Even I can do that and I'm no banker. Lucky your DH is able to ask those questions for you I guess!
logic
Original Author
16 years ago
last modified: 9 years ago
hobokenkitchen: "I'm just tired of the one sided information being posted by logic. There is much to learn and the articles are interesting, but there is more to this story than logic wants to let on.."

Then by all means..do share..inclusive of links to support what you know about all of those things that I'm not "letting on"... in order that it may be relied upon as actual information..and not merely your opinion...that is IF you can.

It would certainly be much more productive than the continous complaint about how tired you are of me and/or my posts...as you continue to read them nonetheless...LOL!!
Nancy in Mich
16 years ago
last modified: 9 years ago
Since I Village took over and the fora have what looks like unlimited numbers of pages now, what does it matter if those interested in discussing one area (or even one point of view on that area) start new threads? It is not like we are limited to 20 or 30 pages anymore. All this arguing and finger-pointing about arguing is tiresome. Make a point about the info presented and please stop attacking the presenters for presenting it! Logic is not the first one to get jumped on for giving info to us in new threads. Why does it matter? New articles pasted onto an old thread will get missed by many. I know I don't look at the 60 minutes thread anymore because of the finger pointing from both sides. Logic, you might also leave the comments about qdog not answering your questions back on that thread and not carry the argument over here.

Of course, all of this is just my own humble opinion and you can disagree with me and I will not argue about it!
dreamgarden
16 years ago
last modified: 9 years ago
"Logic-Have you see this article? Talks all about how it is ONLY the borrowers' fault for the subprime mess and NOT the lenders, banks, etc!"

Logic-Sorry for the confusion, this was meant to be sarcastic (no slight intended to you). I was trying to point out what the Fed is doing in response to all of the subprime complaints. They obviously recognize that the problem can be traced to both sides and not just borrower ignorance.
graywings123
16 years ago
last modified: 9 years ago
Of course it is nice for people to be able to sit back and blame 'big business' for their mistakes.

Sure, lots of irresponsible people did stupid things. But they didn't go out and invent these finance schemes. The reason that Logic's posts resinate with so many of us is that they point out the larger institutional problem that has come back to bite us all in the ass.

In the same way that we punish drug traffickers more severely than drug abusers, so are the financial institutions who benefitted from these schemes more culpable than the home buyers.

The more I think about it, the drug trade is a pretty good analogy.
logic
Original Author
16 years ago
last modified: 9 years ago
graywings: "In the same way that we punish drug traffickers more severely than drug abusers, so are the financial institutions who benefitted from these schemes more culpable than the home buyers.

The more I think about it, the drug trade is a pretty good analogy."

Exactly, graywings...and you have made the point more succinctly than I....

..nancy in mich.........that is what I was attempting to get people to understand by repeatedly asking qdognj to focus on my other analogies.......in that I failed.

That said, perhaps graywings analogy will accomplish what I have yet been able to do with some...to demonstrate that people do not deserve to be scammed and they are not losers and/or low lifes simply because they were not blessed with strong intelligence or good analytical skills...or because they fear confrontation.. or simply because they are naive.

IMO, when all is said and done, the majority of the buyers who were screwed in this debacle will turn out to be decent, well meaning, average people who were scammed or boxed into an untenable position (along the lines of the couple from Staten Island NY) by those who are more sophisticated than theyand although some borrowers most certainly did act knowing they were being irresponsible and/or greedy, it is grossly unfair, extremely short sighted and intellectually arrogant to paint all (or even most) borrowers who were snared by the lending industry with the same brush.
qdognj
16 years ago
last modified: 9 years ago
Mortgage brokers/lenders compared to drug dealers? I have read some radical views, but this has got to be the top one..Absolutely ridiculous..
logic
Original Author
16 years ago
last modified: 9 years ago
BTW dreamgarden, thnaks for the clarification. :-)

It is good to see the Fed finally acknowledging the real problem. Of course..what action they ultimately take will unfortunately most likely be minimal at best..time will tell.
dianemargaret
16 years ago
last modified: 9 years ago
Logic you have succeeded in convincing me and here is why.

"Attorney Noah Pusey said his clients tried to back out of the deal before closing but were told they'd lose their $5,000 deposit."

Buyers who need a mortgage routinely sign a contract with a financing contingency, among other contingencies. If all of the other contingencies are satisfied the only way the buyer can get out of the contract and get his deposit back is if the buyer cannot get financing. Not if the buyer cannot get financing that makes sense to him, but only if the buyer cannot get financing of any kind. If the mortgage company did to others what it tried to do to me on the day of settlement, put a monkey wrench into the financing I chose, I wonder if I would have been obligated to continue with a restructured loan on a moment's notice or lose my deposit. I guess so. Luckily we had gone through our local bank and we found out later the monkey wrench was thrown by Countrywide, to whom we were sold almost immediately we found out afterwards. Luckily my hometown banker found a way to counfound the the ridiculous demand Countrywide had come up with at the last minute. Of course none of this was explained to me at the time. I was just furious with her that the matter did not come up until the day of closing and in fact the sellers, who went to the table earlier in the day, were the ones who called me and said there was a problem.

I was one of those that did not realize or understand that my local bank was going to sell my mortgage. It was certainly never brought up during my conversations with my local banker.
logic
Original Author
16 years ago
last modified: 9 years ago
dianemargaret, we had a similar situation happen back in '87...during the last RE boomright before closingon new homes...that were already 6 months behind schedule.

BTW..the mortgage companyconnected with the builder got into all sorts of hot water a year of so later for all sorts of improprieties ..and eventually closed down

Although we were fortunate enough to have the time to argue..and win (can you tell by now Im relentless?), our future neighbors did notand I have therefore seen this happen, firsthand to responsible, intelligent people who I came to know well over the next 13 years, who get maneuvered into doing what they did not sign on to do...or face having no place to liveor losing a considerable amount of money.

I am glad to hear that my efforts to supply info here has served to inform people who will pass on that infoand make it that much harder for scammers to scam those who are less in the "know".
dianemargaret
16 years ago
last modified: 9 years ago
You? Relentless? noooooooooo.

It's funny, since it was never suggestd to me to restructure the loan to an adjustable rate because of my local banker's smart move, I never wondered before what I would have done if that was what would have been suggested on that stressful day.
logic
Original Author
16 years ago
last modified: 9 years ago
dinaemargaret: "I never wondered before what I would have done if that was what would have been suggested on that stressful day."

Luckily for you that you were never faced with such a decision.

As from here on out, knowledge is power.
feedingfrenzy
16 years ago
last modified: 9 years ago
What qdog says in this thread --

"Mortgage brokers/lenders compared to drug dealers? I have read some radical views, but this has got to be the top one..Absolutely ridiculous.."

What he said in an earlier thread --

)))))RE: I owe more than the house is worth, and it isn't selling. :( clip this post email this post what is this?
see most clipped and recent clippings

Posted by qdognj (My Page) on Wed, Jan 9, 08 at 17:19

FF, i see what you arer saying, BUT....
here is my example
You walk down the street in a questionable neighborhood in NYC..At every street corner there are people trying to sell you drugs..But you are a smart person, realizing that buying and taking drugs is NOT good for you..The dealers keep giving you reasons why it is ok, but you KNOW better..So no matter what they say, you are not buying..You are smart enough to know right from wrong, you don't need the bank,err drug dealer to sell you the mort,err drugs, because you know they don't have your best interest in mind... (((((((

Giggle, tee hee.
qdognj
16 years ago
last modified: 9 years ago
wow, did i really say that :)

in any event, YOU as a buyer/signer are responsible for your actions, and that has been my stance from way back..lol...Now go look it up, lol
logic
Original Author
16 years ago
last modified: 9 years ago
feedingfrenzy, Touché!!!! :-D

A judge rules that they were victimized by predatory lenders

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