When will they ever learn
Apr. 24th, 2009 05:05 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
pecuniumI'm seeing ads which make me think there are companies out there planning to cash in on the present turmoil in the housing market, by stirring the present pot.
LendAmerica, which has been running annoying ads; designed to look like news spots (on the Bloomberg model of too busy, with split windows and tickers on the bottom). They were about getting second mortgages, using Chris Dodd (D- Connecticut) to give it gravitas.
Now they look like investment spots. Don't own a home... this is the time to get one. "Nothing beats the pride and security of owning your own home" (really, tell that to the one in 14, or so, who are in foreclosure). They say lots of wall Street Firms are holding onto empty homes, and you can get a deal ("closing costs paid by the seller").
On one level they are right. If I had the money, I'd be looking at it (I know someone who scored a great deal on a house in Indiana.... About $9,000 and it was theirs. Paid in full. Needs some work, but it's not in bad repair. Just someone who had speculated, and didn't get out in time). But the ad goes on, touting "An FHA program which only requires 3.5 percent down, and includes money to remodel.
DING DING DING.... I am afraid the only thing which is going to save people from getting in over their heads is that the secondary lenders (Because I somehow don't think LendAmerica is really in the lending business, but rather in the "Make a loan, sell the paper" business), are being less liberal in their disbursing of money.
Doing a bit of research... It looks if I understand it, as if they are doing a few things. 1: When you go to their website, they have banners asking, "Are you afraid of the sub-prime market?"
2: They are a direct lender, which means they can hide some of their revenues.
3: They are actively acquiring Ginnie Mae mortgages, so they can offer mortgage backed securities.
4: There are a few complaints against them. I'd expect some (mortgages are complicated things, and lots of people don't get what they think they are getting).
5: The owners have had run ins with the law, related to mortgage fraud.
All in all, my less than warm fuzzy from the ads, is not changed much from the research.
LendAmerica, which has been running annoying ads; designed to look like news spots (on the Bloomberg model of too busy, with split windows and tickers on the bottom). They were about getting second mortgages, using Chris Dodd (D- Connecticut) to give it gravitas.
Now they look like investment spots. Don't own a home... this is the time to get one. "Nothing beats the pride and security of owning your own home" (really, tell that to the one in 14, or so, who are in foreclosure). They say lots of wall Street Firms are holding onto empty homes, and you can get a deal ("closing costs paid by the seller").
On one level they are right. If I had the money, I'd be looking at it (I know someone who scored a great deal on a house in Indiana.... About $9,000 and it was theirs. Paid in full. Needs some work, but it's not in bad repair. Just someone who had speculated, and didn't get out in time). But the ad goes on, touting "An FHA program which only requires 3.5 percent down, and includes money to remodel.
DING DING DING.... I am afraid the only thing which is going to save people from getting in over their heads is that the secondary lenders (Because I somehow don't think LendAmerica is really in the lending business, but rather in the "Make a loan, sell the paper" business), are being less liberal in their disbursing of money.
Doing a bit of research... It looks if I understand it, as if they are doing a few things. 1: When you go to their website, they have banners asking, "Are you afraid of the sub-prime market?"
2: They are a direct lender, which means they can hide some of their revenues.
3: They are actively acquiring Ginnie Mae mortgages, so they can offer mortgage backed securities.
4: There are a few complaints against them. I'd expect some (mortgages are complicated things, and lots of people don't get what they think they are getting).
5: The owners have had run ins with the law, related to mortgage fraud.
All in all, my less than warm fuzzy from the ads, is not changed much from the research.
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no subject
Date: 2009-04-25 02:25 am (UTC)And yes I know people frown on those sort of loans but
1. Since the market is slow, paying interest to ourselves actually isn't that bad, not like he took the money out of something making tons of money.
2. Our house is so cheap, the loan is actually quite tiny
3. If you decide not to pay it back, there are just tax penalties. Income tax ones, not like a 401k where you have other penalties too
4. This isn't his only retirement investment
Just in case anyone wanted to jump in with NEVER TAKE A LOAN FROM YOUR RETIREMENT!
Also, paying it off/owning a house is important because of Teddy. Not knowing where he will be, or if there still will be disabled housing options when he turns 18, we REALLY need a piece of property to at least ensure a roof over his head. We should have this paid off in less than 10 years. (Really, the house is quite a bit under 75k left -- it was rent to own.)