Bla, Blady, Bla, Bla

It’s all blather -government saying they’re going to protect us against unscrupulous lenders. You know, make them disclose everything. If only we could require the same of them.

“Yeah, no more taking advantage of people! “

I’ve blogged about this before in “Clamp Down on Mortgage Lenders?” back in 2007 when the subprime meltdown was just starting. But obviously I need to say it again.

We are in the process of refinancing our mortgage through Bank of America (a Big recipient of TARP funds after agreeing under pressure from then Treasury Secretary Paulson to buy Merrill Lynch), so as soon as we got credit approval and all our paperwork passed muster we receive a HUGE package. I’m talking $8.70 in postage huge!

The bundle included a 75-page book called Application Disclosure Handbook, a copy of our appraisal (this part is totally good-everyone who pays $665 for an appraisal should get a copy of it!), and all the documents that relate to our application, 27 more pages. So I say to myself,  this is probably good, everything you need to know all right here for sometime when I have about 3 hours dead time or a bad case of insomnia! But as soon as I start reading it I am bombarded with blatant mistakes right from the first page!

First of all, the address is wrong. Despite having corrected it on the application from the very beginning we can’t seem to get that across to anyone. The interest rate does not match what we have locked our loan at, but what’s a half a percentage point among friends? Next, we have applied for a 5-year interest only loan, but the paperwork says the term is 30 years. Later I find out this is because it becomes an adjustable rate ARM after 5 years. Oh yes, and the loan amount is wrong. They include 3 TILs (Truth in Lending) Disclosure Statements -3 copies of the same thing, all wrong. And an amortization schedule which is incorrect, and on and on.

I could just scream!!!!  pulling-hair-out.jpg

WE JUST NEED THE BASICS. I mean who is going to read over 100 pages from their lender and understand it – especially when there are blaring mistakes from the get-go? Nobody that’s who. Mission accomplished I guess. They don’t really want to make it understandable, they just want to say they are making it understandable, you know so they can say they did something.

So I said it before and I’ll say it again. KISS, keep it simple stupid. This is all we really need to know.

  1. What is my loan amount?
  2. What is my interest rate?
  3. When do I have to pay it off or refinance?
  4. How much do I pay every month?
  5. When will the interest rate adjust?
  6. Is there a pre-payment penalty and if so, how much will it cost me?

Just the facts mam. ALL ON 1 PAGE, IN BOLD PRINT about 16 point font.

That’s my Tip of the Day!

Aloha, “Mikie”

Mikie Likes It LLC
Realtor Referrals

Michelle Kerr
(Principal Broker/Owner)

Phone: (808) 896-1943


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