-Another F@CKED Borrower- casualty of the housing bubble: Thanks for all the feedback!

-Another F@CKED Borrower- casualty of the housing bubble

Another FB is a mortgage 'insiders' view on the lending industry, the housing bubble, and the loose credit standards that drove it all. This site is dedicated to educating people on how to make good financial decisions and not become another F@CKED Borrower (FB)!! Many of these bwrs had NO business getting a loan...but lax underwriting standards, low rates, stated income, interest only loans, option-ARMs, neg-am's, no-doc loans, and more, made this froth/bubble possible.

Sunday, December 04, 2005

Thanks for all the feedback!

I will be answering as many of the questions as possible over the next few days. Some I have the answers to, some I do not. Unlike a lot of people, I will tell you when I don't know something, or where I am not an expert. Me blowing smoke up your a@@ doesn't help you get a correct anwer, and it doesn't help my credibibity.

It seems that people like the F@CKED borrower stories, so I will keep them coming. Goodness knows I have enough of them written down.

So stay tuned, and I will get to as many of those posts as I can!

Thanks for stopping by...

SoCalMtgGuy

*****I made a quick post in the previous thread (asking for feedback) where I gave some "bullet" answeres to some of the questions. Check it out below.*****

4 Comments:

SoCalMtgGuy said...: Karen,

2/28, 3/27, 5/25 are the designations used by "subprime" companies when talking about ARMs. First number is the length of the fixed period, the 2nd number is the time it is adjustable. ex: fixed for 3 years, adjusts for the next 27.

"A-paper" generally uses the 3/1, 5/1, 7/1, 10/1 terms. This means the fixed period is for 3,5,7,10 years then it adjusts. It is tied to a 1-year treasury index.

I hope this helps to answer your question.; 12/05/2005 9:26 AM
SoCalMtgGuy said...: azgolfer,

Without seeing your document papers, and knowing the entire situation, I can't really answer your question.

BUT, I can tell you that there is a difference between RATE and APR. The APR (annual percentage rate) takes all of the fees (origination, processing, points, misc fees, etc.) and finds out what your real "rate" is.

If your rate is 5.25%, by the time all of the fees are added (nobody does loans for free) your APR will probably be about 5.75.

So, without my knowing any of the specifics, that would be my best guess for your situation.

I hope that helps...

SoCalMtgGuy; 12/05/2005 9:32 AM
Anonymous said...: hello possums,

here is a good article on option arms, margins, ect ..

arms; 12/05/2005 1:12 PM
Anonymous said...: Karen,
You're smart! I like to think I am too! We sold our home this past summer, and we now living at our business (we have a very large manufacturing plant and converted a large unused office space into very cool living quarters), paid off all debt, sold our other investment property (w/ carrybacks, which I love)...it's important to us, financially, socially, and spiritual to live within our means...we have the cash to live beyond comfortable, and don't worry about the real estate storm. And I'm a real estate agent...! But I'm losing business not only because of the slowdown, but because I refuse to lead buyers and sellers down the path to ruin...I'm cautioning everyone to be very careful...some clients leave me because I am not 'aggressive'...but I also gain clients that appreciate my pragmatic approach.
You can make an honest living at whatever you do if you treat people as you wish to be treated.
I know what people say and feel about r.e. agents, but I'm guilt-free...I've never earned a commission off of someone's misfortune or ignorance.
And this is a great blog....thanks!; 12/05/2005 1:58 PM