Some REAL examples of F@CKED Borrowers
DISCLAIMER: these are actual scenarios that I have seen while pricing out loans. I will only provide the basic data used to price a loan (fico, loan amount, doc type, ltv, etc). I will not post, nor do I have the personal info for these bwrs. That information only becomes available when submitting a loan...and trust me...these loans are far from being submitted.
So here goes:
- Bwr bought a condo about a year ago for 350k. did a Stated loan to 100%. Bwr needs "payment relief" (I love the way people say that...like they have a headache or something). The broker had not done a comp check yet...but either way, if they could not afford the rates they had, there is NO way they could afford them now. Not to mention the 10k pre-pay penalty (approx) and whatever the broker/title/escrow fees would have been. Just AFB!!!
- bwr NEEDS to refi and pull some cash out. They need a stated loan to 90% ltv. OK, not pretty, but I can get it done. But wait! there is a kicker......there were a "couple" (actually more like several) 60 day mortgage lates in the past 12 months. And that fico score...well it fell below 540. Sorry buddy...lots of lenders will make that loan at lower LTV's (that way, when they take your house, they don't lose any money), but at 90%...no way! Just AFB!!!
- I could go on...but I think you get the point right now.
So here goes:
- Bwr bought a condo about a year ago for 350k. did a Stated loan to 100%. Bwr needs "payment relief" (I love the way people say that...like they have a headache or something). The broker had not done a comp check yet...but either way, if they could not afford the rates they had, there is NO way they could afford them now. Not to mention the 10k pre-pay penalty (approx) and whatever the broker/title/escrow fees would have been. Just AFB!!!
- bwr NEEDS to refi and pull some cash out. They need a stated loan to 90% ltv. OK, not pretty, but I can get it done. But wait! there is a kicker......there were a "couple" (actually more like several) 60 day mortgage lates in the past 12 months. And that fico score...well it fell below 540. Sorry buddy...lots of lenders will make that loan at lower LTV's (that way, when they take your house, they don't lose any money), but at 90%...no way! Just AFB!!!
- I could go on...but I think you get the point right now.
posted by SoCalMtgGuy at 9:23 PM
10 Comments:
Oh, please do go on!
This info validates what a lot of us suspect is happeing, but have a hard time imagining, given that we're prudent with $$$$.
My husband was at a seminar and the speaker was talking about the economy, RE and all the new creative financing. A woman in the back didn't know what he was talking about and asked what he meant. When he explained, she burst out in a laugh.
I think a lot of average Americans do not realize how irresponsible all this lending/refinancing is.
This blog is definitely going in my bookmarks. You tell the info very well.
Great Blog!!
Did you read the SD Union Tribune article on the air traffic controller and his flight attendant wife having a hard time paying the HELOC and the multiple mortgages on their multiple negative income properties?
I thought that pretty much qualifies for a family of AFB.
Oc renter
Doesn't surprise me in the LEAST.
Amazing how many people thing LOSING 1000 bucks a month on a rental is a "good real estate investment".
I'll keep updating as things come along. WIth today as Veterans day...it has been pretty slow.
mtgguy - great blog! please keep the stories coming. i have wondered for the last 5 years how all these folks in socal have been able to buy such expensive homes while the median income has barely risen?
oh, man, this is going to be a fun blog to check out
there are going to be milllllllioooonnnnsssss of fb's soon. so sad.
Imagine if the dumbest, poorest person you know qualified for a $100,000 margin account at ameritrade in 2000 and put it all in Cisco. Oh, wait, Pets.com.
That's what this is going to be like
FYI - my blog is http://housingpanic.blogspot.com - enjoy
bookmark!
every anecdotal story has a lesson or tip contained therein....
please keep 'em coming
Best perspective from a mortgage lender's perspective. I think all of us out here appreciate your frankness, as we are skeptical of the spin we hear from the real estate industry. Please keep the real stories and your commentary coming.
I like how the Google Adwords bring up "Stated Income" and "Stated Loans." Ironic.
Well, I can say this for sure. People are going to need more information on how to imporve their credit score. You can get some of that information here...
bad credit mortgage loan late credit repair fix free
Interesting
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