Q&A: Getting a Loan

Q: It is hard to meet the criteria to borrow money from a bank these days. Our credit score is not bad but we do not have the 20-30% being requested as a down payment by the 3 banks we have talked to so far. Where do you go to borrow money when banks won't loan?

A: Banks are not the only sources for financing. The question does not specify what you wish to borrow money for, but if it is for a car or a house then considering your local credit union is the first thing I would recommend.

Credit unions have always been a good resource for financing large ticket items like cars or homes or home repairs. While credit unions started out as a resource for employees of a particular company or industry, many credit unions have expanded their memberships so that almost anyone can join a credit union if they choose to. Most of us have either a family member or friend who is a member of a credit union we would qualify to join. Additionally, there are credit unions which you can join just because you live in a specific geographic area.

While it is frequently not a good idea, borrowing from family may be a solution as well.

Lastly, I would be remiss if I did not address the fact that banks are, in fact, still loaning money.

It is true that loans are harder to come by. They have raised the credit score to qualify as well as increased the amount of paperwork and the down payment required to get a loan in most cases. Those are good guidelines which would have prevented the mortgage mess we are experiencing had they been in place during the past 4-6 years. While it is true that conservative lending will reduce the number of loans which are made, it will also decrease the number of defaults which occur.

If your credit needs some repair, get a copy of your credit report from all three credit reporting agencies and work on getting yourself ready for a good loan at a reasonable interest rate.

Log onto: www.freeannualcreditreport.com. Why not get started today? It will be time well spent.

Copyright © 2008, Home Ownership Matters, LLC. All Rights Reserved.

(Please E-mail Heather at homeownershipmatters@gmail.com with any questions, comments or concerns you might have! We appreciate all comments and feedback, so please don't be shy.)

WORD: Credit Reporting Agency

And the WORD for Today is:

Credit Reporting Agencies – agencies which maintain records of consumer credit as reported to them by creditors. Businesses use this information to evaluate your applications for credit, employment, insurance and other purposes. It is important that the information in your credit file is complete and accurate. Recent legislation has made it possible for all consumers to receive a copy of their credit report from each of the agencies once a year. If you are considering a purchase you might want to check and see what they have to say about how you pay your bills. It would be wise to check all 3 agencies since they may not have the same information in their file. Likewise if you are working on credit repair you should forward any corrections to all 3 agencies since they do not share information with each other.

There are 3 major credit reporting agencies in the United States. They are:

Equifax
P.O. Box 105252
Atlanta, GA 30348
1-800-685-1111

Experian
P.O. Box 2002
Allen, TX 75013
1-888-397-3742

TransUnion
P.O. Box 1000
Chester, PA 19022
1-800-888-4213

Copyright © 2008, Home Ownership Matters, LLC. All Rights Reserved.

You can find more helpful definitions of WORDS like these in Your Real Estate Advisor which can be purchased at www.DovePublishingHouse.com.

(Please E-mail Heather at homeownershipmatters@gmail.com with any questions, comments or concerns you might have! We appreciate all comments and feedback, so please don't be shy.)

WORD: Fair Credit Reporting Act

Fair Credit Reporting Act—is a consumer protection law, which regulates the disclosure of consumer credit reports. It was passed to ensure the accuracy and privacy of the information which is kept by credit bureaus and other agencies which report credit. The FCRA also gives consumers the right to know what information these entities are distributing about them to creditors, employers, potential landlords, insurance companies or anyone else who has the legal right to request such information.

Copyright © 2008, Home Ownership Matters, LLC. All Rights Reserved.

You can find more helpful definitions of WORDS like these in Your Real Estate Advisor which can be purchased at www.DovePublishingHouse.com.

(Please E-mail Heather at homeownershipmatters@gmail.com with any questions, comments or concerns you might have! We appreciate all comments and feedback, so please don't be shy.)

WORD: Loan Package

And the WORD for Today is:

Loan Package—refers to the file of all the items necessary for the lender to decide to grant or not grant the loan. These items would include the information on prospective borrower such as loan application, credit report, financial statements, and supporting documentation, employment verification and any other personal information to verify the credit worthiness of the applicant. In addition, the file would also include information related to the acceptability of the proposed property such as an appraisal to substantiate value and a survey. There is usually a charge for “packaging” the loan.

Loan package also commonly refers to the bundle of papers sent from the lender to the title company in order to finalize a real estate transaction. The /loan package/ usually contains all the necessary paperwork to “close the loan.” The mortgage or deed of trust, note and all required disclosures, from anybody to anybody, would be included. A loan closing package might include as many as 60-80 pages of material.

Copyright © 2008, Home Ownership Matters, LLC. All Rights Reserved.

You can find more helpful definitions of WORDS like these in Your Real Estate Advisor which can be purchased at www.DovePublishingHouse.com.

(Please E-mail Heather at homeownershipmatters@gmail.com with any questions, comments or concerns you might have! We appreciate all comments and feedback, so please don't be shy.)

FYI: Trick-e-ration

It’s NOT a check; it’s TRICK-E-RATION

When is depositing a check a BAD thing?

And….the correct answer is: When it is Trick-e-ration.

I got a check in the mail

You know how it is this time of year, money is tight and utility bills are high and you are looking for an answer to your finances in any shape, form or fashion. I am right there with you. This morning when I took the trash out I checked the mail, which I had not done the day before (I had enough bills already, thank you very much). To my surprise there was an unexpected check there, from a company I recognized, with my correct name and address and everything.

Trick-e-ration begins

It really looked like a check. The edges were all perforated for you to be able to easily tear it open. It clearly stated on the outside “check enclosed”. There really WAS a check inside. Payable to me or the bearer. Payable at (or drawn on) JPMorgan Chase Bank. I admit it, I went and got a deposit slip and placed the check with my purse so that when I went out later in the day I could deposit it. It did cross my mind to wonder why the Fun Club was sending me a check but hey, money is money. I needed the little check for $9.25. I even said “Thank you Lord”.

Bad things could happen . . .

I sat down to write my blog for today on something else totally different and laid the check beside me on the desk. That is when I noticed that there was a small box underneath the amount for the check and just above the signature line which said:

“By cashing or depositing this check you are purchasing a membership in AutoVantage Enhanced. Void if amount over $9.25.”

Almost got me

Many folks who know me think of me as a ‘smart person’. And the truth is that I probably am fairly bright. I know my subject matter and I am a college graduate and I make a decent living traveling around the country and speaking on the issues of foreclosure, mortgage fraud and the like. However, the truth is that ‘smart people’ make mistakes just like anyone else because being smart in a particular area does not mean you know any more that anybody else in some other subject matter and ALL of us make mistakes. If I was not in the habit of STUDYING contracts and looking for some kind of ‘trick’ in things related to banking and business, I would have gotten got. I stopped, studied my ‘gift check’ and decided they were trying to trick me into signing up for a subscription to something I had never even heard of before.

Marketing is Marketing

At first I was not mad with them for using this unique way of marketing. It is a brilliant plan. It almost worked on me. But then I start to think about the many folks, especially seniors, who would fall for this and get themselves into trouble because if you deposit this little pitsy check, bad stuff starts to happen.

Bad things you didn’t expect

On the back of my ’gift check’ where you endorse it.

“READ CAREFULLY BEFORE SIGNING”.

By cashing this check I agree to a thirty day trial offer in AutoVantage Enhanced. I understand that the $15.99 monthly fee will be automatically charged to my credit card with Great Fun unless I cancel my membership by calling 1-877-397-4430 before the end of the trial period. I understand that after my first year I will be charged $16.99 per month for the next twelve months and I will also be charged every month thereafter at the then-current monthly fee, unless I call to cancel and owe nothing thereafter.

CHECK VOID IF ALTERED OR UNSIGNED

X_________________________________________________

Signature of Payee required for processing T71479105

Warning

Please read again (or for the first time if you never read it before) the blog entry for April 16, 2009 on your signature. Now I am mad. I am very, very mad. I am mad not because they A LMOST got me but I am mad because I can see how they got my mom and your mom and hundreds of thousands of others who either cannot read well or did not read and signed themselves into a long term mess for some magazine subscription that they never would have signed up for had some slick marketing guru not come up with the novel idea of sending out a real check—with TRICK-E-RATION strings attached. Just a comment: when legitimate people need to send a check in the mail—for legitimate reasons—NEVER do they write on the outside, CHECK ENCLOSED. They try to avoid advertising to your mail carrier or anyone else that you have received a check. Clearly, the reason it was written on the outside of my ‘gift check’ was to ensure that I would open it and hoping I would cash it without closely examining exactly the nasty strings attached. Clearly, TRICK-E-RATION. I am going to forward my ‘gift check’ to the Attorney General’s office for every state in the union and hope that they will help these folk with their next advertising campaign.

BE forewarned…

If you read the introduction of why I write this blog I readily admit that I have done almost all the wrong stuff you can do related to housing and it is only through God’s grace that I have survived to report the outcome and point you in a better direction. I am awfully glad the check came so I would have yet another ‘personal educational experience’ to share with you. I don’t always enjoy the lessons of life; frequently they are harsh and not nearly as gentle as this near miss. However, I appreciate all of them. All of them have led to the place where I am and will take me on to where I am destined to be. The same is true for you.

Embrace today! Be grateful that things are as good as they are and watch out for Trick-e-ration!

Know that you are blessed!

Copyright © 2008, Home Ownership Matters, LLC. All Rights Reserved.

(Please E-mail Heather at homeownershipmatters@gmail.com with any questions, comments or concerns you might have! We appreciate all comments and feedback, so please don't be shy.)