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DPChallenge Forums >> Rant >> The Presidental BS conference
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02/24/2009 10:47:18 PM · #1
Originally posted by Bear_Music:

Originally posted by DrAchoo:

Originally posted by SDW:

This is something that pissed me off. In January when my Dad passed away I called my mothers bank and asked if she could have an extension on her home loan. You know a skip payment where they put the payment on the back end of the loan. The reason we asked was because we had to send my dads Social Security Check back to the government and his retirement checks was also cutout and we had a lot of expense to cover.

Guess what the bank said. They told me that they could not accommodate our request because my mother was not behind on her payments. Let me say that again... Because she and my dad had paid on-time every-time and was up-to-date on their mortgage they could not honor our request. They would need to be two months behind to do a skip payment. The bank representative said that was one of the rules set forth in the bailout package.

What kind of crap is that?????


An obvious question...why not just skip a payment yourself? What difference would it make vs. getting the bank's permission?


Black mark in the credit history/credit rating. Something to be avoided, especially right now.

R.


Exactly!

My Mother and Dad had never been behind on their mortgage, in fact they always paid it about 10 days before the due date.

If you fail to pay a month your bank will note the payment late and your FICO score will be negativity effected. Doing a skip-payment which means putting that months payment at the end of the loan will not put you behind and will not effect your FICO score, however it will take a month longer to payoff your loan but with no penalties or fees. An example would be if your mortgage was due to be paid in full on March 1, 2010 and you did a skip-payment then it would push the maturity of the loan to April 1, 2010.

As I stated in my earlier post my wife works at a financial institution and that is how I knew that banks, CU, and Finance companies can do this. But since TARP I they are not allowed to do this unless the customer is two months behind.

Message edited by author 2009-02-24 22:57:29.
02/24/2009 08:55:39 PM · #2
Our credit union has a similar "deal" where you can apply to waive three payments, IF you are in good standing. The three payments are tacked onto the end. You are not considered "behind," but it will take you three months longer to pay off (and if I remember correctly, the interest keeps adding).

As far as credit reporting, because it is the CU in charge of it, it is not reported, if my understanding is correct.
02/24/2009 08:29:50 PM · #3
Originally posted by Bear_Music:

Yeah, but from SCOTT'S point of view, if the bank volunteers it doesn't show up as negative credit, whereas if he just skips the payment then he's a month behind forever until such time as he makes two payments in a single month, and that's bad.

R.


Yes, that's a possible difference. The not being able to catch up until you can make two payments. It's not clear in my mind how that would show up on your credit. A perpetual 30 days behind or a single case of a payement that gets further and further in arears.
02/24/2009 08:22:20 PM · #4
Yeah, but from SCOTT'S point of view, if the bank volunteers it doesn't show up as negative credit, whereas if he just skips the payment then he's a month behind forever until such time as he makes two payments in a single month, and that's bad.

R.
02/24/2009 08:14:24 PM · #5
Originally posted by Bear_Music:

Black mark in the credit history/credit rating. Something to be avoided, especially right now.

R.


I thought that would be the answer, but if you are skipping a payment, how is that not a black mark? Your FICO score measures your credit risk and if you are undergoing major life changes (which Scott obviously is), you are an increased credit risk. So the system is doing it's job. It may be the bank was willing to do this at one point when credit was loosy-goosy and nobody really cared what your FICO was, just that you had a pulse and a job (maybe), but the reality was the bank was doing you a favor at that time. But now that we're in a credit crunch, the banks are scared as hell about lending and not getting their money back. So the favors are over. Sure it sounds like a favor to the two-month deliquent person, but is it? They already have a 2-month ding on their credit report.
02/24/2009 07:44:16 PM · #6
Originally posted by DrAchoo:

Originally posted by SDW:

This is something that pissed me off. In January when my Dad passed away I called my mothers bank and asked if she could have an extension on her home loan. You know a skip payment where they put the payment on the back end of the loan. The reason we asked was because we had to send my dads Social Security Check back to the government and his retirement checks was also cutout and we had a lot of expense to cover.

Guess what the bank said. They told me that they could not accommodate our request because my mother was not behind on her payments. Let me say that again... Because she and my dad had paid on-time every-time and was up-to-date on their mortgage they could not honor our request. They would need to be two months behind to do a skip payment. The bank representative said that was one of the rules set forth in the bailout package.

What kind of crap is that?????


An obvious question...why not just skip a payment yourself? What difference would it make vs. getting the bank's permission?


Black mark in the credit history/credit rating. Something to be avoided, especially right now.

R.
02/24/2009 07:43:14 PM · #7
Originally posted by SDW:

This is something that pissed me off. In January when my Dad passed away I called my mothers bank and asked if she could have an extension on her home loan. You know a skip payment where they put the payment on the back end of the loan. The reason we asked was because we had to send my dads Social Security Check back to the government and his retirement checks was also cutout and we had a lot of expense to cover.

Guess what the bank said. They told me that they could not accommodate our request because my mother was not behind on her payments. Let me say that again... Because she and my dad had paid on-time every-time and was up-to-date on their mortgage they could not honor our request. They would need to be two months behind to do a skip payment. The bank representative said that was one of the rules set forth in the bailout package.

What kind of crap is that?????


An obvious question...why not just skip a payment yourself? What difference would it make vs. getting the bank's permission?
02/24/2009 05:27:21 PM · #8
Originally posted by SDW:

My wife works at a financial institution in the loan department. But here is what I think is bad. If you have say five debits/checks to clear that day, the bank will always pay the highest debit/check first. They do this so they can get as much in overdraft fees as possible if you don't have enough to cover all the check for some reason or another. i.e. If you had $100.00 in the back and the five checks were $80, $25, $25, $25, $25 respectively by posting the $80 withdrawal first you will have four overdraft fees. At an average of $35.00 per that would be $140 in bank fees plus the amount of each withdrawal ($25) for a total of -$240.00. If they would post from lowest check to highest the four $25.00 checks would have cleared and you would only have one overdraft fee of $35.00 + the check of $80.00 for a total of -$115.00. But they want to make as much money in overdraft fees as possible.

Just the way it is.


Damn straight. I've actually read articles about various movements afoot to have this sort of behavior on the banks' part considered fraud. It's outrageous.

R.
02/24/2009 04:46:20 PM · #9
My wife works at a financial institution in the loan department. But here is what I think is bad. If you have say five debits/checks to clear that day, the bank will always pay the highest debit/check first. They do this so they can get as much in overdraft fees as possible if you don't have enough to cover all the check for some reason or another. i.e. If you had $100.00 in the back and the five checks were $80, $25, $25, $25, $25 respectively by posting the $80 withdrawal first you will have four overdraft fees. At an average of $35.00 per that would be $140 in bank fees plus the amount of each withdrawal ($25) for a total of -$240.00. If they would post from lowest check to highest the four $25.00 checks would have cleared and you would only have one overdraft fee of $35.00 + the check of $80.00 for a total of -$115.00. But they want to make as much money in overdraft fees as possible.

Just the way it is.
02/24/2009 04:10:08 PM · #10
Several years ago, someone I know had a problem in which, on a given day, checks drawn were assessed before deposits were credited, resulting in bounced checks even though the net balance at the end of the day was (would have been) positive.

Though, in this case, the bank ended up having to write several letters of explanation and apology ...
02/24/2009 04:05:04 PM · #11
Yah, the banks are getting real hard-ass. I deposited a check that, apparently, did not clear. I bounced 6 checks as a result. 6x35 = $210.00. The 6 checks, totaled, were for $80 or so. The bank account's $321 overdrawn. And I have to eat it... Say what? These things all cleared on the same 2-day span, and the bank can't relax on nearly quadrupling the amount they paid out with the penalties?

Time to switch banks...

R.
02/24/2009 03:59:29 PM · #12
Scott, that is a bad story. I have to wonder if this is indeed spelled out in the bailout package or if this is part of the bank's interpretation and own rules regarding the bailout. The latter would make more sense, but either way it is absurd.

I was one day late with a credit card payment for the first time in some years and I couldn't get the $39.00 penalty fee waived. I understand in the past that was fairly easy to do if one had a good payment history. No more!
EDIT: Not blaming that on the bailout, but on the economy in general and the reaction of the banks and credit card companies.

Message edited by author 2009-02-24 16:00:37.
02/24/2009 03:41:34 PM · #13
This is something that pissed me off. In January when my Dad passed away I called my mothers bank and asked if she could have an extension on her home loan. You know a skip payment where they put the payment on the back end of the loan. The reason we asked was because we had to send my dads Social Security Check back to the government and his retirement checks was also cutout and we had a lot of expense to cover.

Guess what the bank said. They told me that they could not accommodate our request because my mother was not behind on her payments. Let me say that again... Because she and my dad had paid on-time every-time and was up-to-date on their mortgage they could not honor our request. They would need to be two months behind to do a skip payment. The bank representative said that was one of the rules set forth in the bailout package.

What kind of crap is that?????

Message edited by author 2009-02-24 15:43:29.
02/24/2009 02:17:25 PM · #14
Originally posted by Mousie:

Is it greedy to be pissed off that since you're the responsible one who CAN pay a mortgage and DID buy a house you can afford, but your house is $150K underwater because of all the foreclosures in your neighborhood (you had to buy a home to live in at the height of other people's market speculation), even though interest rates are plummeting you simply can NOT refinance to a saner rate, while people who did speculate and did buy more than they can afford are getting all the love?

*grumpy*


Nope - not greedy at all. Being responsible has its own cross to bear. Kind of like being labeled a terrorist because you feel the 2nd amendment gives you an individual right, whilst your neighbors are awash in misrepresented propaganda and are clamoring to infringe on your known right.
02/24/2009 01:38:46 PM · #15
Originally posted by Matthew:

There does appear to be a movement in US republican thinking away from liberal policies (by which I mean freedom from interference by the state) towards totalitarianism under the auspices of right-wing leadership. Here is an interesting article on the subject.


As I suspect is no surprise to you, I have a different take than Mr. Greenwald. I am familiar with each of the points in Glenn Greenwald's piece (militias, rights embrace of expanded gov't actions, angry white males of the 90's, '94 takeover of congress, and even recently Glenn Becks assertion of a potential uprising with the queery of who would the military support) however, I cannot agree with Charles Johnson's assessment and conclusion, as Mr. Greenwald does. It does not surprise me to read the choice of words (as in intentionally prickly adjectives) Mr. Greenwald inserts into his prose, yet simply because he uses such caustic descriptives, does not in any way sway me to his view of the matter. Yes there is an uncomfortableness amongst a portion of the electorate, but the catalyst is one of a nationalistic concern over where we are headed with a commander in chief so similar to Wild Bill (a fast talking, nuance associating, behind your back, smiling while you get stabbed - president) as opposed to the less "cultured" (from a public speaking standpoint) former president whom they felt was a fairly straight talker - even though most the the liberal and world press made fun of his speaking style. Some folks really like a gifted speaker, a mesmerizing orator who holds the audience captivated. The folks who are being described by Glenn Greenwald, are a less trusting sort - of that delivery style. More meat and potatoes oriented.

name sp edit

Message edited by author 2009-02-24 14:10:55.
02/24/2009 12:43:14 PM · #16
Is it greedy to be pissed off that since you're the responsible one who CAN pay a mortgage and DID buy a house you can afford, but your house is $150K underwater because of all the foreclosures in your neighborhood (you had to buy a home to live in at the height of other people's market speculation), even though interest rates are plummeting you simply can NOT refinance to a saner rate, while people who did speculate and did buy more than they can afford are getting all the love?

*grumpy*

02/24/2009 11:05:55 AM · #17
Originally posted by Flash:

Matthew Matthew Matthew - what am I to do with you.

1. I do not speak for nor represent the Republican party.
2. Please re-read my post, and answer me if you think for any portion of a second that I am being serious. It is a very intentional characterization of the environmentalists argument against vehicle size - just applied to housing. If it is irresponsible to own/drive certain vehicles, then where is all the outrage on excessive size houses and their wasteful misuse of natural resources? Kind of brings a tear to my eye.


I realised that you were being satirical. I had intended to use it to make a serious point - not to treat it as a serious proposition (but intonation can be difficult in text).

There does appear to be a movement in US republican thinking away from liberal policies (by which I mean freedom from interference by the state) towards totalitarianism under the auspices of right-wing leadership. Here is an interesting article on the subject.
02/24/2009 07:51:21 AM · #18
Originally posted by Flash:

Matthew Matthew Matthew - what am I to do with you.

1. I do not speak for nor represent the Republican party.
2. Please re-read my post, and answer me if you think for any portion of a second that I am being serious. It is a very intentional characterization of the environmentalists argument against vehicle size - just applied to housing. If it is irresponsible to own/drive certain vehicles, then where is all the outrage on excessive size houses and their wasteful misuse of natural resources? Kind of brings a tear to my eye.


Well, *I* picked up on the satire, anyway. I would suppose most of us did...

R.
02/24/2009 07:13:16 AM · #19
Originally posted by Matthew:

Originally posted by Flash:

Obama says we all need to sacrifice - lets start with house size. ...

A house you can afford based on what your government says you need. Please call your congressman and senator to push for this sensible legislation.


It amazes me how the republican movement has moved away from deregulation and free marketeering towards totalitarianism. Moderation seems to be giving way to extremism hastened on its way by alarmism, an appeal to base instinct over reason, and totemism of certain individuals.


Matthew Matthew Matthew - what am I to do with you.
1. I do not speak for nor represent the Republican party.
2. Please re-read my post, and answer me if you think for any portion of a second that I am being serious. It is a very intentional characterization of the enviornmentalists argument against vehicle size - just applied to houising. If it is irresponsible to own/drive certain vehilces, then where is all the outrage on excessive size houses and their wasteful misuse of natural resources? Kind of brings a tear to my eye.
02/24/2009 07:08:47 AM · #20
Originally posted by Judith Polakoff:

Originally posted by Flash:

A.R.M. were used by those who could not afford the property they were buying. They were betting on either selling the property shortly for a quick profit or pay raises to accomodate the rising house payments. If they were planning to sell for a quick profit then they were speculators. If they were planning on future pay raises, then they were not very bright.


Or they assumed the value of their house would increase very quickly and they would refinance to a lower rate before their mortgage reset. For many years this was a sound and rational strategy.


Judith - this is/was still a gamble. And gambling has losers. Anyone choosing this option, should have been responsible enough to understand that they MIGHT NOT get the favorable outcome. You did, and that's great - but I'm certain you were prepared for another result. That I think is the difference. Taking a risk and being prepared for either result vs. taking a risk and only being able to afford the very best outcome which is not gauranteed. The latter is what I would call irresponsible.
02/23/2009 06:25:27 PM · #21
Originally posted by Flash:

A.R.M. were used by those who could not afford the property they were buying. They were betting on either selling the property shortly for a quick profit or pay raises to accomodate the rising house payments. If they were planning to sell for a quick profit then they were speculators. If they were planning on future pay raises, then they were not very bright.


Or they assumed the value of their house would increase very quickly and they would refinance to a lower rate before their mortgage reset. For many years this was a sound and rational strategy.

Originally posted by Flash:

Regardless, If you cannot afford a 30 year fixed mortgage, then maybe you are in over your head. A.R.M.'s are not a long term buying strategy.


It depends on the circumstances. When I got a mortgage back in 1989, a 30-year fixed was at something around 11 or 11.5 percent. So I got a variable rate with good terms, anticipating that interest rates would decline, and it worked out very well. Context matters.
02/23/2009 05:38:50 PM · #22
Originally posted by Flash:

Obama says we all need to sacrifice - lets start with house size. ...

A house you can afford based on what your government says you need. Please call your congressman and senator to push for this sensible legislation.


It amazes me how the republican movement has moved away from deregulation and free marketeering towards totalitarianism. Moderation seems to be giving way to extremism hastened on its way by alarmism, an appeal to base instinct over reason, and totemism of certain individuals.

Message edited by author 2009-02-23 17:40:27.
02/23/2009 03:50:57 PM · #23
Originally posted by Flash:

Anyone with a 15 or 30 year fixed who was employed, lost their job, and used their savings, then they should be helped.

I haven't lost either of my part-time jobs, but my hours have been cut back, and I'm using savings to make up the difference in income to try and stay current -- I have a 15-year/fixed and 30-year/fixed second, with about 50% equity before the downturn in housing prices.
02/23/2009 03:00:01 PM · #24
Originally posted by GeneralE:

Respected (by me, anyway) conservative columnist David Brooks on why, though distasteful, Money For Idiots is still sometimes the necessary course of action.


My only note on the article was the sentence where here again another writer states that the trouble with the domestic automakers was rooted in decisions from decades ago. Well, if the doemstic automakers current trouble is rooted in decades old decisions, then so is every body elses. You can't claim that this the the worst financial crisis since the Great Depression - and by the way - except for the domestic automakers, whose troubles are their own because they made poor business calculations. That is just crap. The domestics are in trouble for the same reasons as every other business - the economy stinks.

ANYONE choosing an A.R.M. (temporary low interest adjustable rate mortgage) is taking a "known" risk and gambling. Gambling has winners and losers. Most lose. A.R.M. were used by those who could not afford the property they were buying. They were betting on either selling the property shortly for a quick profit or pay raises to accomodate the rising house payments. If they were planning to sell for a quick profit then they were speculators. If they were planning on future pay raises, then they were not very bright. Regardless, If you cannot afford a 30 year fixed mortgage, then maybe you are in over your head. A.R.M.'s are not a long term buying strategy. Anyone with a A.R.M. who defaulted - should be out of luck. Anyone with a 15 or 30 year fixed who was employed, lost their job, and used their savings, then they should be helped.
02/23/2009 02:22:49 PM · #25
Originally posted by GeneralE:

Respected (by me, anyway) conservative columnist David Brooks on why, though distasteful, Money For Idiots is still sometimes the necessary course of action.


Excellent piece of work. He concludes, referring to Obama and his policy makers, with the following:

Originally posted by david brooks:

And they seem to understand the big thing. The nationís economy is not just the sum of its individuals. It is an interwoven context that we all share. To stabilize that communal landscape, sometimes you have to shower money upon those who have been foolish or self-indulgent. The greedy idiots may be greedy idiots, but they are our countrymen. And at some level, weíre all in this together. If their lives donít stabilize, then our lives donít stabilize.


I couldn't agree more.

R.
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