Boater wrote:
Reginald P. Smithers III, Esq. wrote:
Eisboch wrote:
Help me out here.

I hear the economy is frozen. Banks won't lend. No mortgages.
Hoarding their bailout money.

Yet, virtually every commercial break on MSNBC or CNN features at
least one pitch from a major bank or a mortgage company (Ditech comes
to mind, which is a GMAC subsidiary) offering low interests
mortgages, loans and "we have money to lend" announcements.

So, why aren't they lending? Seems to me that this would be an
ideal time for people to re-finance for lower rates, etc.

Economics confuses me.

Eisboch




Loans are available for anyone with good credit. They are being
selective on who they make loans to. The problem we had with Fanny
Mae was making loans for more than the home was worth, to people with
bad credit, and who were not putting any money down. It was a govt.
plan to allow everyone to own a home. The problem is, without a down
payment, the homeowner had no more invested in the home than when he
was renting an apartment.


The "problem" with the home loans is just a teeny bitty bit deeper than
that, and had mostly to do with the packaging of loans into investment
instruments for resale to others.

Yes, it had to do with packaging bad loans with a high probability of
default, the loans I mentioned above. Those investment instruments
would be a great investment, if the loans were going to be paid, or they
could recoup the money in foreclosure. neither can be done, when there
is no down payment, and the mortgage was for more than the home was
worth. Home loans have been packaged as investments for over 50 yrs,
and probably much longer, and were considered a fairly safe investment,
when we used reasonable criteria for determining who would get the loan.
Once Fannie Mae said, guaranteed that they would buy and resell the
loan, regardless of risk, it opened the flood gates for all banks and
mortgage companies to disregard the ability of the person to repay the
loan.

On Dec 5, 12:11*pm, Boater wrote:
Eisboch wrote:
"Boater" wrote in message
...
Eisboch wrote:
"Boater" wrote in message
...
Eisboch wrote:
Help me out here.

I hear the economy is frozen. *Banks won't lend. *No mortgages.
Hoarding their bailout money.

Yet, virtually every commercial break on MSNBC or CNN features at least
one pitch from a major bank or a mortgage company (Ditech comes to
mind, which is a GMAC subsidiary) *offering low interests mortgages,
loans and "we have money to lend" announcements.

So, why aren't they lending? * Seems to me that this would be an ideal
time for people to re-finance for lower rates, etc.

Economics confuses me.

Eisboch

Mostly unregulated handouts...the banks need to pay their Xmas bonuses
first.
Huh?

The funds the banks and brokerage houses received were mostly without
strings, at least at first, and they're not making loans because the funds
were used to pay bonuses and buy golden parachutes for the execs.

Right?

So all the ads I see on TV inviting morgtage and loan applications are just
a front?

Eisboch

Just the TV versions of the Nigerian email scams... * :)- Hide quoted text -

- Show quoted text -

Man you are an idiot.

wrote in message
...
On Fri, 5 Dec 2008 11:26:55 -0500, "Eisboch"
wrote:

Help me out here.

I hear the economy is frozen. Banks won't lend. No mortgages. Hoarding
their bailout money.

Yet, virtually every commercial break on MSNBC or CNN features at least
one
pitch from a major bank or a mortgage company (Ditech comes to mind, which
is a GMAC subsidiary) offering low interests mortgages, loans and "we
have
money to lend" announcements.

So, why aren't they lending? Seems to me that this would be an ideal
time
for people to re-finance for lower rates, etc.

Economics confuses me.

Eisboch


Basically they are only lending to people who can guarantee to pay
them back these days. That eliminates most of the businesses or
homeowners in upside down mortgages and an unsecure job.
The thing that is missing is people who will loan money for a dream.



Sounds pretty much like how it was back in 1983 which was the last time I
applied for and received a mortgage.

As for businesses, banks have never been a good financing source, other
than for a basic, limited credit line, backed by tangible collateral. In
the case of small business, the collateral often consists of the equity in
the business owner's personal house. I saw people's houses auctioned off
and vowed to my wife that I'd never go there.

The business I had grew to a $20M+/year operation and I never had a bank
loan or line of credit. When I sold it, the buyer's financial people
(large, public company) who were doing the due diligence raised some flags
and temporarily held up the process. They simply didn't believe that we had
no debt.

There are much better ways to finance a dream.

Eisboch

On Fri, 05 Dec 2008 13:10:55 -0500, Reginald P. Smithers III, Esq. wrote:


Yes, it had to do with packaging bad loans with a high probability of
default, the loans I mentioned above. Those investment instruments
would be a great investment, if the loans were going to be paid, or they
could recoup the money in foreclosure. neither can be done, when there
is no down payment, and the mortgage was for more than the home was
worth. Home loans have been packaged as investments for over 50 yrs,
and probably much longer, and were considered a fairly safe investment,
when we used reasonable criteria for determining who would get the loan.
Once Fannie Mae said, guaranteed that they would buy and resell the
loan, regardless of risk, it opened the flood gates for all banks and
mortgage companies to disregard the ability of the person to repay the
loan.

I would argue a healthy bank should be able to withstand the present
default rates. It wasn't the default rates that brought banks down, it
was leverage. 33 to 1 in Lehman's case.

I would also point out, when you lose 1/2 million jobs, as we did in
November, it isn't only the subprime loans that go into foreclosure.

On Dec 5, 1:46*pm, wrote:
On Fri, 5 Dec 2008 10:23:30 -0800 (PST), wrote:
On Dec 5, 12:11*pm, Boater wrote:
Eisboch wrote:
"Boater" wrote in message
...
Eisboch wrote:
"Boater" wrote in message
...
Eisboch wrote:
Help me out here.

I hear the economy is frozen. *Banks won't lend. *No mortgages.
Hoarding their bailout money.

Yet, virtually every commercial break on MSNBC or CNN features at least
one pitch from a major bank or a mortgage company (Ditech comes to
mind, which is a GMAC subsidiary) *offering low interests mortgages,
loans and "we have money to lend" announcements.

So, why aren't they lending? * Seems to me that this would be an ideal
time for people to re-finance for lower rates, etc.

Economics confuses me.

Eisboch

Mostly unregulated handouts...the banks need to pay their Xmas bonuses
first.
Huh?

The funds the banks and brokerage houses received were mostly without
strings, at least at first, and they're not making loans because the funds
were used to pay bonuses and buy golden parachutes for the execs.

Right?

So all the ads I see on TV inviting morgtage and loan applications are just
a front?

Eisboch

Just the TV versions of the Nigerian email scams... * :)- Hide quoted text -

- Show quoted text -

Man you are an idiot.

L-I-A-R- Hide quoted text -

- Show quoted text -

You remind me of a little Doxie dog we rescued when I was a kid. She
used to lurk in a small closet by the front door and bark at anyone
who came in the door. The bitch was mean though, and would actually
come out and attack if provoked, you just hide under your desk barking
nonsense, not really making much difference to anyone. How does it
feel to be Harry's little bitch, would you bend over for him too if he
asked?

"Eisboch" wrote in message
...

Forgot .... also pitches for credit cards.

Eisboch

Get those almost weekly.

On Fri, 05 Dec 2008 12:49:55 -0500, "Reginald P. Smithers III, Esq."
wrote:

Loans are available for anyone with good credit. They are being
selective on who they make loans to.

Really?

Go get a car loan from a bank with a 720 credit score.

Go ahead - I'll wait.

--

"An idealist is one who, on noticing that
a rose smells better than a cabbage, concludes
that it will also make better soup."

H.L. Mencken

Tom Francis - SWSports wrote:
On Fri, 05 Dec 2008 12:49:55 -0500, "Reginald P. Smithers III, Esq."
wrote:

Loans are available for anyone with good credit. They are being
selective on who they make loans to.

Really?

Go get a car loan from a bank with a 720 credit score.

Go ahead - I'll wait.

--

"An idealist is one who, on noticing that
a rose smells better than a cabbage, concludes
that it will also make better soup."

H.L. Mencken

My credit score is over 800, so it would be hard for me to do that. If
I was looking for a car loan, I would do it at a credit union, and they
are still making them way below market. I haven't check, but since 720
is still considered a excellent rating, I would guess they are still
making them.

While I have not check what the car/home loan rates are based upon FICO
score, Forbes did and in a Dec. 3 rd article, they said:

"If you do qualify for a loan, the higher your score is, the lower your
interest rate will probably be. According to Fair Isaac, the interest
you will be charged for a 30-year fixed interest rate mortgage on a
$300,000 loan could be as low as 5.67% if your credit score is 760 to
850, while it might be as high as 6.99% if your credit score is 620 to
659. A three-year auto loan would be 6.68% if you have a credit score of
720 to 850, but if your credit score is 620 to 689, you will be charged
as much as 12% for that same loan. "

http://www.forbes.com/finance/2008/1...score_inl.html

On Fri, 5 Dec 2008 11:26:55 -0500, "Eisboch" wrote:

Help me out here.

I hear the economy is frozen. Banks won't lend. No mortgages. Hoarding
their bailout money.

Yet, virtually every commercial break on MSNBC or CNN features at least one
pitch from a major bank or a mortgage company (Ditech comes to mind, which
is a GMAC subsidiary) offering low interests mortgages, loans and "we have
money to lend" announcements.

So, why aren't they lending? Seems to me that this would be an ideal time
for people to re-finance for lower rates, etc.

Economics confuses me.

Eisboch



I applied for an LL Bean card over the internet last week. I filled out the
application, hit the button, and was approved within about seven seconds.
For $31,000! Hell, all I wanted was free shipping and monogramming.

Don't ask me what's going on. I think the liberals just want to bitch about
banks and anything that's non-union. It'll all get fixed when Obama takes
office.
--
John H.

On Fri, 05 Dec 2008 12:49:55 -0500, "Reginald P. Smithers III, Esq."
wrote:

Eisboch wrote:
Help me out here.

I hear the economy is frozen. Banks won't lend. No mortgages. Hoarding
their bailout money.

Yet, virtually every commercial break on MSNBC or CNN features at least one
pitch from a major bank or a mortgage company (Ditech comes to mind, which
is a GMAC subsidiary) offering low interests mortgages, loans and "we have
money to lend" announcements.

So, why aren't they lending? Seems to me that this would be an ideal time
for people to re-finance for lower rates, etc.

Economics confuses me.

Eisboch




Loans are available for anyone with good credit. They are being
selective on who they make loans to. The problem we had with Fanny Mae
was making loans for more than the home was worth, to people with bad
credit, and who were not putting any money down. It was a govt. plan to
allow everyone to own a home. The problem is, without a down payment,
the homeowner had no more invested in the home than when he was renting
an apartment.

Wait a minute here. The regulators wanted to hold Fanny and Freddie's feet
to the fire and got their butts chewed by Barney and Chris. I remember
seeing that!
--
John H.