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Thread: avoid falling victim to unscrupulous mortgage lenders

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    Featured Member Vamp's Avatar
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    Default avoid falling victim to unscrupulous mortgage lenders

    http://images.businessweek.com/ss/06...aol_realestate

    This link has ten tips how to avoid predatory lending
    By Douglas MacMillan

    After working as a loan officer for little more than a year, Ted Janusz said he became fed up with the predatory tactics he and his fellow lenders employed to receive thousands of dollars in kickbacks.

    “If somebody came in wearing cowboy boots and ripped-up jeans, those are the people you took to the cleaners on fees. That was the unwritten rule. We were looking for people we’d see as having less than perfect credit,” Janusz says.

    Not long after leaving his lending post, Janusz exposed the industry’s secrets to the public in his book Kickback: Confessions of a Mortgage Salesman (Insight, 2005). In this slide show, he teams up with BusinessWeek.com to help the average borrower understand how to avoid falling into the traps that loan officers are good at setting.

  2. #2
    Sitri
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    One word RESPA

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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    THANK YOU VAMP!!!!! That's exactly the info I need.

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    Featured Member Vamp's Avatar
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    YOUR WELCOME!!! im always here for ya babe

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    Featured Member scorpio's Avatar
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    some guy was in the business for 1 year and suddenly he's an expert? Most LO's can't fill out a 1003 properly after a year. Sounds like he is trying to cash in himself.

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    Featured Member Vamp's Avatar
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    Everyone is trying to cash in. The question is how? Cashing in at the expense of others or by helping others?

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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    ^^^^Have you read it, Scorpio? Or are you saying there's no such thing as an unscrupulous lender?

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    Featured Member scorpio's Avatar
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    not saying there's no such thing as an unscrupulous lender/broker. but in this day and age, everyone works off of fear. scare people to death.

    everyone's looking to make a fast buck. this guy is doing by scaring people about unscrupulous lenders.

    if you do not want to be taken by an unscrupulous lender, do your research. and, generally the guys who are in the business for a year or less have very little clue of what they are talking about. be wary of taking sound advice from someone who is not seasoned. never put your full trust into anything anyone says without having facts to back it up.

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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    His book sounds like a great first step. I recommended a friend check this and other books out. Forewarned is forearmed. Please add your favorites to the list that help shoppers avoid broker scams.

  10. #10
    PhillyDancer1982
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    Yeah tell me about dodgy mortgage people. A few months ago, this asshole came into my club and kept trying to talk me into buying a house from his company. He's a big wig at Home Vestors, that annoying company that has the big yellow "We buy ugly houses" billboards all over Philly. He kept telling me that I worry too much, I'm going about house buying "all the wrong way" by following advice in nearly every respectable mortgage book and/or website, that I didn't have to worry about a down payment, etc. He told me that it didn't matter that I didn't have provable income or a down payment, because my credit was sooo good but thing is, is that my credit is a few points shy of 700 and I KNOW that the best mortgage rates are reserved for people with scores over 725. Yeah right, like I'm gonna stop worrying about paying off my car loan, stop worrying that my score isn't the optimum 725, stop worrying that I have like no savings at all for a house, and terminate my apartment lease early to buy something I can't really afford. Oh suuuuure. What's really annoying is, he looked well-to-do(obviously he is, if he runs a company like that) and I was trying to get him to spend money, and he literally didn't spend a single dime on me. I wanted to be like, look bitch, don't try to come here and hustle us dancers when WE'RE here to make money, not spend money on a predatory company. Later on, I was contemplating calling up Home Vestors and telling them that I'd rather pay $2000/month to rent a cot at a HOMELESS SHELTER before I'd EVER consider buying a house from them. Then I realized that this comment might constitute as harassment and quite frankly I can't afford the extra harassment charges it might bring.

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    Featured Member Vamp's Avatar
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    Every thing that is listed on the link i provided are some of the things predatory lenders are doing. I wouldn't have added the link if it wasn't. No matter how long the author has been in the business he still made some great comments.

    If you have a better resource for information on predatory lending we would love to review it

  12. #12
    PhillyDancer1982
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    Yeah, and in my opinion I think Home Vestors might be a predatory company! Predatory companies tend to target people who either have bad credit or are gullible to fall for their predatory terms. That asshole from Home Vestors was TRYING to do just that, by trying to convince me that I don't need a down payment, tip-top perfect credit, savings, etc and that I should rush out and get a house ASAP just because he says so. What an idiot. Doesn't he realize that I'm smarter than that? He also said something about "flipping houses," which in my opinion means that he cons people into selling them to him for less than the full market value, then he sells them for more than their value and high interest to some gullible person who cares more about wanting a house than the terms of agreement.

    Anyone know anything about Home Vestors? That guy sincerely pissed me off that he tried to waste my time like that. Again, I would rather pay $2000/month to rent a cot at the homeless shelter, before I'd spend a penny on one of his houses...ok ok maybe that's exaggeration/hyperbole, but you get the idea about how I feel about them.

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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    Here's 2 suggestions for first time homebuyers : 100 Questions Every First Time Home Buyer Should Ask : with answers from top brokers from around the country by Ilyce Glink and Real Estate home inspection checklist from A-Z by Guy Cozzi

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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    Quote Originally Posted by PhillyDancer1982
    He told me that it didn't matter that I didn't have provable income or a down payment, because my credit was sooo good but thing is, is that my credit is a few points shy of 700 and I KNOW that the best mortgage rates are reserved for people with scores over 725.
    Just so you know...you're wrong. If you have a score of 680 or above you will get the best available financing options. The difference between 680 and 720 score MAY be an 1/8 of a point.

  15. #15
    PhillyDancer1982
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    ^ OK maybe that is true, although I heard that the best rates were reserved for scores of 725 and better. 680 isn't even A credit, it's B-grade!

    My point is, the guy was being a slick salesman in the middle of a fuckin' strip club by telling me that I had no problems at all with buying a house at any given notice. Which isn't true! OK maybe the credit thing would be ok for me, but entering the real estate market immediately with NO savings, NO down payment, NO agreed end to my fairly new apartment lease, NO experience with house buying, etc...is just not a good idea! Buying a house is a process that would take time, discipline, research, and saving! Yeah there are mortgages out there for first-time home buyers that don't require a down payment, but would I really want to do that? Point is, the guy was trying to hustle me and although it didn't work, it still annoyed me that he was trying to waste my time.

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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    Quote Originally Posted by PhillyDancer1982
    ^ OK maybe that is true, although I heard that the best rates were reserved for scores of 725 and better. 680 isn't even A credit, it's B-grade!
    You're, once again, wrong. 680 is A GRADE paper. I work in the field...I think I would know. Then it tapers off. The "best" rates, as I've already stated for a 725 credit score is only about .125 better than a 680.

    My point is, the guy was being a slick salesman in the middle of a fuckin' strip club by telling me that I had no problems at all with buying a house at any given notice. Which isn't true! OK maybe the credit thing would be ok for me, but entering the real estate market immediately with NO savings, NO down payment, NO agreed end to my fairly new apartment lease, NO experience with house buying, etc...is just not a good idea! Buying a house is a process that would take time, discipline, research, and saving! Yeah there are mortgages out there for first-time home buyers that don't require a down payment, but would I really want to do that? Point is, the guy was trying to hustle me and although it didn't work, it still annoyed me that he was trying to waste my time.
    I sort of agree with you. I do not advise anyone buying a home unless they have reserves already saved in the bank. I think it's foolish. I think its a bad move. However, I do agree that buying a home and getting a mortgage are extremely time consuming. If people put the amount of thought/effort/research into mortgaging their homes as they do in looking for a home, then there would be no problems. Predatory lending has always been out there. But, the whole "freak out" about subprime lending and "predatory lending", etc. is just a bit over the top. YES, they are out there...YES, you can get taken by one if you are not well-researched on the subject...YES, to all of that and more...

    But, subprime lending is NOT the reason for the current market. Not ALL subprime lenders are out to "take you" and not all mortgage brokers who deal with subprime clients are predators and out to "get them".

    Do your research, keep up your payments, maximize your savings, and you'll be fine.

  17. #17
    PhillyDancer1982
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    OK you're probably right. Or maybe I was looking at a credit scoring model that scores things differently. In that case, what would the grade break-down be for credit scores? E.g., what is considered A, B, C, D, and F credit?

    About 4-5yrs ago, I applied for a Voice Stream cell phone and the guy told me that I avoided having to pay an upfront deposit by the skin of my teeth. He told me that the cut-off for getting a phone without paying a deposit was C credit, and mine was just barely a C. At the time, I had only one credit card(with a shitty $200 limit) that I'd had for 8 months and I'd always paid on time. I was a bit annoyed that I only had a C credit. Meanwhile, this snotty psycho(the one who I later sued in small claims court) was there and he made some rude remark, "Gee, it's so funny how you obsess about getting A's in school and you freak out if you get a B+. But when it comes to credit, you're fine with a C!"(what an asshole) So I'm just curious, what range would my score been in at that time?

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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    It tends to be different with different lenders/creditors...but this is the basic model (I'll pull my info out tomorrow and update if needed)...but its the basic gist of it.

    680 + = A paper, prime loans

    580 - 679 = B paper loans

    500 - 579 = Subprime loans

    499 and below = sorry charlie.

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    Featured Member Vamp's Avatar
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    Default Re: avoid falling victim to unscrupulous mortgage lenders

    30 Yr fixed mortgage

    760-850 6.076% $1,813

    700-759 6.298% $1,857

    660-699 6.582% $1,912

    620-659 7.392% $2,076

    580-619 8.275% $2,259

    500-579 9.131% $2,442

    http://www.myfico.com/

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