Palm Beach Real Estate and Loans

Can someone please tell me why the BS in the Mortgage industry just keeps going?

Folks, you not going to like the answer, but here it is:

"There's a sucker born every minute" - That line is usually traced back to P.T. Barnum of circus fame.

That does sound pretty harsh - but think about it....  If Consumers made the effort to learn more about the industry, the low-grade companies that perpetuate the scams wouldn't be able to get away with the garbage that they do!!

Now I'm not blaming the Consumer - you have all been pummeled to an extreme with all of the Mortgage / Home Loan ads that you see every day!  They're on TV, the Internet, in magazines, newspapers and I even saw an ad (handwritten!) on a sign as I was driving through Palm Beach Gardens to work this morning.

It seems like some companies are playing a big game called:

"Who Can Get the Customer to Swallow the Biggest Load of Bull!?"

They treat people in an extremely condescending way - because we let them.

This stuff insults the hell of of me - and it should do the same thing to all of you.

The only way to combat this problem is for people in general to learn the basics and wisen up - so YOU don't get taken to the cleaners!

You don't need a degree in finance to use common sense - and that will be more than enough to get you around some of the biggest lies / stretched truths in the current advertising arsenal.

Here, in no particular order, are some of the craziest things I've seen:

-    Several companies advertise Mortgage programs that don't cost anything!!! The specific ads change from company to company, but the gist is always the same - YOU get a loan for FREE!  The number of people that fall for this is shocking.  Those companies figure - 'Hey it gets them in the door, once they're here we got 'em.'   It's true, too many people just won't get up and leave even when they see that they've been lied to!  Let's see.... do you work for free?  Probably not - and neither does the Mortgage Broker / Loan Officer / Lender / Bank.  They're making money SOMEWHERE.  How?

• There really isn't a Brokerage Fee, but the Processing fee (a few hundred dollars is normal) turns out to be HUGE!
• There might not be a fee up front, but the rate is very high and there is a pre-pay penalty that will guarantee the bank a certain amount of interest.
• There is no Brokerage fee, but there IS an application fee
• Many people will say that a refinance 'doesn't cost anything' - that's said because you don't come to the closing table with any cash - the fees are all wrapped into the new loan as an increase to the principle (the $ amount borrowed) and, of course, you will be paying interest on that new amount.
• There are many more, but this one made me sick - someone brought me a copy of a "competitor's" fees.  It was actually the other guy's Good faith Estimate - no Mortgage Broker Fees AND no Processing Fee either BUT (and it's a big 'ol butt) the taxes were padded by several THOUSAND DOLLARS!!!!!  (You can't fake the taxes, it's an idiotically simple formula, so 'whoopsie' doesn't cut it).  The difference between their fees and mine were trivial, but because their fees were included with the tax amount, the poor Customer thought they weren't paying anything!!!!  That was the biggest example of fraud I'd ever seen!

OK before we go on to the next one here are a few hints:

1. You've heard it a million times, but: If it sounds too good to be true, it probably is...
2. If you are in the middle of talking to someone about a loan and you have any questions, speak up!  If the professional that you are talking to brushes you off, belittles you or just won't answer, LEAVE!

You are talking about the biggest transaction you and your family might ever make - if you aren't confident, go speak to someone else.

-    I just read an ad that said that you don't need to provide your Social Security information to get a quote - WOW.  This is supposed to make people feel better because they won't be running a credit report - the scam being that every time your credit is run, it's RUINED!!! Not true - but people fall for this too.  The 3 biggest determining factors in qualifying for a loan are your income, your assets and your credit score / history.  There are loans that ignore your income, assets or both - BUT without seeing your credit report, any 'quote' you are given is worthless.  (A Hard Money lender might not care about your credit but that is an extreme case.)

I'm going to end this post here - but I will be adding to the list from time to time. 

Don't get me wrong - there ARE a lot of honest people in the Mortgage business - it's just that the ones that are bad REALLY stink it up for everyone.

I feel a full bore Dennis Miller / Lewis Black rant coming on - so it's time to step away from the keyboard.........

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