Never a Borrower nor a Lender be . . .
5 years ago
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A judge rules that they were victimized by predatory lenders
Comments (34)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....See MoreMortgage lender bait and switch?
Comments (10)Wow! Somebody either erred/misled big time. Was the possibility of wrapping prepaids into a tax deductible point presented to you by a mortgage broker or a loan officer from the lender? Was this arrangement written down anywhere? At any rate, the scenario is not allowed by the IRS and I would think most lenders and settlement companies would be completely aware of this. Your HUD-1 settlement sheet is your document of record and the one the IRS would review in the case of an audit/question. I'd pursue it with a higher up at the lender and,depending, on what I heard report it to the lender's regulatory authority. The deductibility of points can be a bit confusing so I'll let the IRS explain it: ___"Topic 504 - Home Mortgage Points The term "points" is used to describe certain charges paid to obtain a home mortgage. Points may be deductible as home mortgage interest, if you itemize deductions on Form 1040, Schedule A (PDF). If you can deduct all of the interest on your mortgages, you may be able to deduct all of the points paid on the mortgage. For information on deducting interest, refer to Topic 505. You can deduct the points in full in the year they are paid, if all the following requirements are met: -Your loan is secured by your main home (your main home is the one you live in most of the time). -Paying points is an established business practice in your area. -The points paid were not more than the amount generally charged in that area. -You use the cash method of accounting. This means you report income in the year you receive it and deduct expenses in the year you pay them. -The points were not paid for items that usually are separately stated on the settlement sheet such as appraisal fees, inspection fees, title fees, attorney fees, or property taxes. -You provided funds at or before closing, that were at least as much as the points charged, not counting points paid by the seller. You cannot have borrowed the funds from your lender or mortgage broker in order to pay the points. -You use your loan to buy or build your main home. -The points were computed as a percentage of the principal amount of the mortgage, and -The amount is clearly shown on your settlement statement. Points that do not meet these requirements may be deductible over the life of the loan. Points paid for refinancing generally can only be deducted over the life of the new mortgage. However, if you use part of the refinanced mortgage proceeds to improve your main home and you meet the first six requirements stated previously, you can fully deduct the part of the points related to the improvement in the year you paid them with your own funds. Points charged for specific services, such as preparation costs for a mortgage note, appraisal fees or notary fees are not interest and cannot be deducted. Points paid by the seller of a home cannot be deducted as interest on the seller's return, they are a selling expense which will reduce the amount of gain realized. Points paid by the seller may be deducted by the buyer provided the buyer subtracts the amount from the basis, or cost, of the residence. Points you pay on loans secured by your second home, can be deducted only over the life of the loan. You may be subject to a limit on some of your itemized deductions, including points, for more information on the adjusted gross income limitations please refer to the Form 1040 Instructions. For more information on points, refer to Publication 936, Home Mortgage Interest Deduction."...See MoreNegotiating with Lenders
Comments (7)Here's a short summary of foreclosure law in Maine: ---------------------- Maine Foreclosure Sale following expiration of Period of Redemption Upon expiration of the period of redemption, if the mortgagor, or the mortgagor's successors, heirs or assigns have not redeemed the mortgage, any remaining rights of the mortgagor to possession terminate, and the mortgagee shall cause notice of a public sale of the premises stating the time, place and terms of the sale to be published once in each of 3 successive weeks in a newspaper of general circulation in the county in which the premises are located; the first publication to be made not more than 90 days after the expiration of the period of redemption. The public sale must be held not less than 30 days nor more than 45 days after the first date of that publication and may be adjourned, for any time not exceeding 7 days and from time to time until a sale is made, by announcement to those present at each adjournment. The mortgagee, in its sole discretion, may allow the mortgagor to redeem or reinstate the loan after the expiration of the period of redemption but before the public sale. The mortgagee may convey the property to the mortgagor or execute a waiver of foreclosure and all other rights of all other parties remain as if no foreclosure had been commenced. The mortgagee shall sell the premises to the highest bidder at the public sale and deliver a deed of that sale to the purchaser. The deed conveys the premises free and clear of all interests of the parties in interest joined in the action. The mortgagee or any other party in interest may bid at the public sale. If the mortgagee is the highest bidder at the public sale, there is no obligation to account for any surplus upon a subsequent sale by the mortgagee. Any rights of the mortgagee to a deficiency claim against the mortgagors are limited to the amount established as of the date of the public sale. The date of the public sale is the date on which bids are received to establish the sales price, no matter when the sale is completed by the delivery of the deed to the highest bidder. -------------------- All that being said. We are at the point of the sale - it does not appear to me that the mortgagors (debtors for the rest of us) have any right that would allow them the ability to do a short sale and that would be what I was told by one person at the bank and two lawyers. My agent called and after talking with another agent who claims to be some 20 year expert - says that if I buy it at the public sale, I will take it along with the subordinate mortgage. Silly me, lawyer and all, I read the above as saying that the purchaser takes the property free and clear of all interests of the parties in interest joined in the action. The second mortgagee is a listed party in interest. So, to recap: 1. In Maine the mortgagee (creditor) must file a civil collection action and get a Judgment of Foreclosure, then the mortgagor (debtor) has 90 days to redeem the property. And within this period of 90 days presumably, you could probably do a short sale. 2. After the 90 days - it sounds like the debtor's lose their status as owners of the proprety, and the creditor can then sell the property at a public sale. 3. Even after the 90 days the debtor can pay the judgment and get the property back, but only at the discretion of the creditor/mortgagee. But it does not look like after that 90 redemption period passes that any short sale can be done. 4. At the public sale, the buyer takes the property free of any interest of the second mortgage so long as that second mortgagee has been listed as a party in interest in the original foreclosure suit and notice given to it. I've about convinced myself to go ahead and order my bank check and show up - who knows the first mortgage may bid less than the foreclosure judgment, but I doubt that, seriously. :) We decided to also go ahead and submit a purchase and sale agreement to the paralegal for the foreclosing attorney, simply because - we feel at the very least she has a fax number and contact at the bank - and if all the stars align properly - the right person at the bank will have our names and information that we want to purchase the property in case I don't buy it at the public sale. I'm still on the fence as there are other considerations - we just don't want it to get caught up in the abyss of some large corporation. I still have some glimmer of hope. MP...See MoreBorrowing Books - Etiquette
Comments (17)Call this post "The Bibliphile as Curmudgeon". I don't lend books except to one friend who is a collector like me. I'm not even crazy about parting with any of my books to her but she has been generous about lending to me when absolutely necessary and she respects books as I do. We share a common, obscure interest; hence the lend-lease policy. I don't lend to anyone else for several reasons. People forget they borrowed them and then can't find them. Then some deny they ever borrowed them. Most of my books are rare, out of print, signed by author etc., and often irreplaceable. A loss is a serious matter. A lot of people don't know how to handle books. They break open the spine, they leave them folded open on a table, they dog-ear the pages, they use books as coasters, they eat or drink while reading (ok, I do that but it's my book and I'm *very* careful). They stick heavy things in as bookmarks. And some, horrors, write in them. They lend them on to other people. The list of biblio-sins goes on. Fortunately, not many people share my interests so they don't want to borrow my books anyway. I have learned to stifle my urge to rave about something I am reading lest I hear the dreaded words, "Oh, that sounds good--can I borrow it?" The kind of books I would lend are books I would not buy but get from the library. I do have a few mysteries around that I've lent to visiting friends/family so careless as to travel without a book. Does my heartless policy cause problems? Yes. Not long ago, a prickly but significant relative was visiting and wanted to borrow one of my Harry Potters. I offered to buy her her own copy. I offered to buy her the whole blinking set. But she was insulted I would not share my pristine copy, part of my pristine set, which I read as each came out. She refused my offer and it did not add to the bonhomie of the weekend. Not a pretty confession but truthful....See More- 5 years ago
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