The "Banking and Credit Crisis" made personal

[Buckrub]

This is not a joke. This is real. This happened to me, a Normal American, today.

A banker friend of mine has badgered me all day long to refinance my house. He did this same thing about 6 years ago, and I did it back then. I took out a new 15 year mortgage at 6.25%, a rate that back then he said was one of the lowest in many years.

I have 9 years to go on this mortgage.

Today he is badgering me again to refinance yet again. He said "rates are the lowest since the Crustacean Period" or some such balderdash. I think they went below 5% today, as if that means anything.

I told him, "Fine.....I'll take a new loan on my house".

I had 3 criteria.

1) I don't care what the interest rate is. The number is meaningless. I simply want my monthly payment to be equal or less to what it is now.

2) I am 61 in June of this year. I want my new mortgage to be paid off before I'm 70, just like my current mortgage will be. I want all the monthly payments to be equal too, no balloon payments.

3) I don't want to pay a single dime of closing costs in any form, by any name. The new loan will be financially transparent to me.

I haven't heard back from him all day.

At COB today, I DID send him another email and asked why his bank accepted $60Million in "stimulus money" when he clearly didn't have any credit crisis, since he was seriously pushing loans to ne'er-do-wells like me?

I haven't heard back from him on that one, either.

[chuck41]

Dang! That dude must have really been hungry for business. Trying to dole out that $60 mil no doubt. Probably had to lend it or return it.

[deadeye]

good for you buckrub,this kinda thing imo has gotten this country in the shape it is in. most people doing this(time after time) dont understand they are really only renting. where are the tax incentives for paying something off? if we dont control it china will soon be our landlord signed from a responsible insurance agent with ethic's

[edge]

You know, what is sick is that Washington thinks that giving money to the troubled banks will help them lend more money, which in turn will put a floor on the housing market.

The banks have Mark to Market accounting which means that if housing keeps going down they will be in worse shape than if they just hold onto the money!

Also many good banks were coerced into taking the TARP funds by the regulators! Many are trying to give it back to escape the morons in Congress

edge.

PS I am still trying to get over the statement about being "normal" ;D ;D ;D

[petev]

The statements made so far on this thread make more sense than all the ones I've heard on the news by the "pros" over the last couple of months. Buckrub, your stipulations to your banker would do well for any potential borrower to follow, and if enough people thought the way you do, we wouldn't be in this mess today!

[deadeye]

i will add a true credit card problem that happened to me just last 9/2008,about 7 yrs ago i refinanced my home & two rentals on 15 yr notes,time to get tough/sink or swim. well have a kid in college & im approx 8yrs to go & everything will be paid off so had a credit card w/advanta for 10yrs with a fairly high balance,never late.credit score above 700,never minumum payments, does not make cent's to re-fi now this long into the game.the card was @ 8.99%,in sept/08 advanta hikes my card for no reason to 25.09%,no reason given & yes sir you have a great credit, never late,no negotiating that's the way it is from advanta cust service. pissed off im searching for another card immediately got another to replace it o% for 15 mo's & wired the $ asap. next month on the advanta card which was not cancelled yet but 0 balance,interest go's to 27.00% sad but true i think i witnessed on just how china might defeat this country financially but not me anymore.yes im soon to be done w/credit cards,dont like the trap!

[Buckrub]

Some additional info on this.

First, this local banker has not given up. He's emailing me, sending me spreadsheets comparing new and old loans, etc etc. When the new loan didn't meet my stated criteria, he said "You're borrowing too little money, you need to borrow more"........

Seriously.

Today I got in an email a solicitation from Ing, an online 'bank' where I have a couple of hundred dollars in penny stocks via ShareBuilder. I might be their smallest investor, seriously.

Well, now THEY are trying to sell me a mortgage refinance! They tout "4.5%, almost no closing costs, they will not sell the loan, and NO points or fees".

Now, someone tell me again WHAT CREDIT CRISIS?

We're being hornswaggled, guys. The only "Crisis" is that banks are having to actually implement rules for folks who buy houses, like they used to before 1994.......that's it. Nothing else is changing.

There's credit out the wazoo if you are a 'bill-payer'.

This sucks. This is costing me (and you) bazillions and gradillions of dollars to give away to banks and insurance companies and investment groups, and they pay bonuses with it.

Why are we not Marching on Washington? I don't get it. Why???

[artjr338wm]

This whole credit card thing is so screwed up and I feel a large portion of the blame belongs at the door step of the credit card companies themselves.

Our government should have had laws in place decades ago that set your credit card limit by what you earn, similar to the way it use to be done in figuring how big a home lone you could get. My mother a long retired widow on a fixed income gets mutable pre aproved credit cards every month each with limits of 15-$20,000. This is nuts. now I'm not for the government regulating much but this is one time they should. The same went for the insane way the lenders would figure out how much home you could afford. When I bought my present house, I was pre-approved for a $400,000 loan!!! I only make if I work all year gross about $80,000. If I paid 20% down that still leaves me with a $360,000 debt and my monthly nut with taxes and Ins figured in would be waaaay over $3000 a month on a 30yr fixed at 5.125% interest. No way on earth could I afford to make my hose pymt if I'm out of work.

I know we must accept responsibility for our own actions but these credit card companies forcefully push these high limit cards on us like candy at X-Mass. Last I read the US has over $15 trillion of outstanding credit card debt, and the average American house hold has over 10 credit cards actively in use.

I my self in one three month period alone (I feel because I have credit rating at or over 780 and had paid off allot of my soon to be wifes debt) received nine pre=approved credit card applications all of which had a limit of over at or over $15,000. Say for the sake of argument I maxed all nine out I would have incurred over $130,000 in debt. A amount BTW which would be financially imposable for me ever, ever to pay off.

I guess it only shows just how deeply our reps in DC are in the pockets of the special intrests that actually run this country.

Sorry if I sound disillusioned, cus I am.

[chuck41]

I just talked to a account manager at Morgan Stanley today. According to him a number of the big organizations were forced to accept the TARP funds. They were strong armed into accepting it and are not allowed to return it, at least not yet. Apparently there were a couple firms that were in critical need. The treasury insisted all the firms accept the bail-out monies or it would not be made available to the couple of big firms that would likely fail without it.

Kinda like you have a kid with a disease and the doctors require everyone in the family take the medication even though only one needs it cause they have to buy it by the gross.

Lots of small banks have bail-out money as well and didn't need it. Apparently they are all calling Buckrub to try to use it to make more interest before they eventually have to return it.