What is Going on with Fannie Mae, Freddie Mac, Lenders, Bailouts - all of this starts with the individual loan to the individual person. If a loan is made to someone who cannot really afford it but is led to believe by a Mortgage Broker - a Lender that they can, yes they may loose there home and the Lender, Mortgage Broker, and Realtor will still all get paid and they get to do the whole process over again. As long as they can "Convince You" that it will work, then oh well if it turns out not to be true. This is NOT their problem.
Some Folks want money no matter what it costs, no matter how much the interest rate or how much the mortgage broker gets paid and they don't care that the Mortgage Broker gets paid for year after year. All some borrowers care about is buying this property or getting this money on this property as soon as possible.
Here on "Main Street" as they say, Here in the Real World of Real Estate the Loans yes may have slowed down for tradition loans, conventional loans But the Marketplace is Even Better for the Middle Man who get you the Money. The can now justify Higher Interest Rate Loans and Higher Commission - Points. They blame the Market. Saying, well I can get you that loan but in this market it will cost a higher interest rate.
They pretend information is coming directly from the lender when in the Real World of Real Estate it is the Mortgage Broker or the Lending Specialist. If they can get a loan for say 5% and get a commission on that loan, plus a bonus for picking that lender (that loan product) and they can tell you .. No Problem with your Loan to Value Ratio - and Your Credit Scores, However, you Will have to pay 9% interest on that loan.
The borrower is just so happy to get the money coming to them to get that house for their family or to get that commercial property that they agree. Next, there is hidden costs, paperwork fees, loan origination fees, and all kinds of hidden costs in the closing papers. However the Real Kicker is Not the Commission and All those "Upfront" fees the Mortgage Broker or Hard Money Placement Guy get, but it is the Trailing commission. Say your Commercial loan is for $700,000 - say the Mortgage Guy gets One Percent upfront plus a few Paperwork fees and whatever they convinced you was necessary. So say they made around $11,000 upfront.. Well They also make, the Difference in percentage of interest, say the REAL lender gets %5 as the Loan Product stated, and the MB convinces you that it really is %9 - then they the Middle Man - the Loan Processor - the Hard Money Loan Guy or whatever Type of Money Middle Person your using, THEY get 4% interest for the LIFE of the Loan, so if you Keep this Loan for say 10 years, then this Person gets a commission of $28,000 a year, that is around $2000 a month (yes a bit more but you get the point). Now times this by 10 years and even more if you use the same person to Re-Finance.
So ONE loan, every month part of your HUGE payment goes to this middle man, NOW had you went directly to the lender your loan would have cost less in the First Place and you Would NOT be Paying a Trailing Commission for the Life of the Loan and NO this does not have to be disclosed to you, it is between the Lender and the Mortgage Consultant - really none of your business - The Real Estate Consumer thinks that %9 is the Best they can get in their circumstance, and if the MB drags this out, then the Consumer is Stuck with them if they want the loan because a new lender may have to dip into the Credit Scores again and that causes a drop so the next time they may not qualify for the Loan... Quite a Legal Scam isnt' it?
It is so hard to get that your willing to do anything to make it happen and the Middle Man - Mortgage Broker - is Laughing all the way to the Bank, EVERY single month for the life of the Loan.
Commercial Loans and Hard Money Loans are typically higher interest rates, which translates as More Money for the Mortgage Broker or Hard Money Placement Specialist. Kind of Like the Non-Sense that Realtors charge a Higher Commission on Raw Land and On Commercial Property because it is Supposedly more work. You JUST have to payer a higher interest for commercial loans Right? I mean that is Just the Way things Work.
As Long as the Loan to Value Ratio Works Out then the Money Will Fall Magically From the Sky.
And How Does the Loan to Value - LTV work out... Let me Count the Ways, Subscribe to My members only Blog to Find out these Dirty Little Secrets. www.SavvyBroker.com
With No Real Regulations or Quality Control on what is deemed to be "Main Street" these folks will continue what they are doing I mean there is Plenty of Money in The Real World of Real Estate To Be had by those in the Middle of Your Real Estate Transaction and REALLY they are not even Actually Necessary to the Transaction.
Hard Money Loans, Really Big Commissions for the Mortgage Broker - year after year and not just up front.
When all Eyes are on the Mortgage Industry and Mortgages are Hard to Get, WELL this is the Time When those in Lending - the Middle Man Makes the Most Money. With Loans, Hard to Get and a Times of "Financial Crisis" Conventiona Loans - Traditional Loans - loans that are straight forward and make the most sense .. they are the ones to go way. However, those who are the Middle Main for Loans such as Commercial Loans - Hard Money Loans they get to "justify" the high interest rates - points and commission and blame it on the market. "Times are Hard, if you want the Money this is what "they are" saying" .. No Problem it Will Just Be More interest, but we can make it work.
The Big Money Companies that Bought Secondary Markets (where the regular real estate buyers loans were SOLD to for a discount and a quick payout), they are the Ones in Financial Ruin, but who cares they are getting billions from the government so that they can do it again.
The Regular Money ( loans from mortgage brokers - hard money loans and such) did not really get hurt, their industry is even better in tough times. In times when conventional loans are HARD to get and so many have lost their credit due to Mortgage Brokers getting them into Bad Loans, Losing their Jobs or whatever reason IT is a GREAT time to Be in Lending for the Mortgage Broker - The Hard Money Lenders - Commercial Lender Brokers - Money Brokers ..
There is No End in Site to the Financial MESS of the Real Estate Industry in the Real World of Real Estate, the Best Protection you Have is Knowledge. www.SavvyBroker.com
There is No End In Site to how Mortgage Brokers in the Real World of Real Estate Really Treat you On a Daily Basis. Even with Proven Fraud on Mortgage Brokers, it takes the supposed "Justice System" so long to ACT - to Investigate that in the mean time the Mortgage Broker has hurt plenty more consumers. Kind of like the Drug Trade where they Want the Big Boys on Top. Meanwhile those with the Very Big Egos getting you money in the real world have no one that they really answer to.
The FBI pretends to be concerned about Mortgage Fraud, but in Reality they are not concerned with Fraudulant Mortgage Activity at the level your living in. If if is NOT hundreds of millions of dollars in Fraud Activities then it seems to be a waste of their time. As a Real Estate Broker Owner I know for Sure that the FBI is not interested in local mortgage broker activities - maybe they do not have the man power - maybe they have no way of really convicting these folks.. who knows... but what you need to know is that this kind of stuff is happening everywhere and you, the Real Estate Consumer is the Victim. Nobody has Your Back, your just part of what makes their world moving along.
The big financial companies build and hoard billions on your back. And when things fall apart - you can bet they have a Very Large STASH of Money to Fall back on ... While your world falls apart they are all fine and the BAILOUTS that happen well that just gives them the money and the right to Do it ALL over Again. You, as the Real Estate Consumer MUST know how to keep from getting hurt from "their" high finance game.
No comments:
Post a Comment