Trigger Lists...Bummer
This is from REALTOR (R) Magazine online.
Daily Real Estate News March 26, 2007
FTC Says It Can't Regulate 'Trigger Lists'The Federal Trade Commission announced earlier this month that it lacks the legal authority to crack down on unwanted “trigger list” phone solicitations to consumers who have applied for mortgages within the preceding 12 to 24 hours.
Companies sell lead generation lists to lenders. The names on the list come with significant financial information, including credit scores, loan balances, credit card debts, and estimated home values. The information emanates from the big three credit bureaus —
Equifax,
Experian, and
TransUnion — following their receipt of an inquiry by a mortgage broker or loan officer.
Rebecca E.
Kuehn, the
FTC's assistant director for privacy and identity protection, says even though the FTC lacks statutory authority to ban
prescreened telemarketing mortgage offers, it does have enforcement authority against bait-and-switch scams and misuse of consumers' credit information. Consumers who experience such problems can file complaints with the FTC online at
FTC.gov.
Source: Washington Post Writers Group, Kenneth
Harney (03/25/07)
Labels: Credit
Personal Financial Analysis
I have been wondering about something lately. In management, there is a term called a SWOT (actually pronounced Swat) Analysis. This tool is particularly valuable when analyzing a company in realtion to its competitive landscape. But, could you use the terms to analyze your own personal financial picture?
What does the acronym stand for? It stands for Strengths, Weaknesses, Opportunities, Threats. I can see this breaking down like this - and this is a ROUGH breakdown...I am still going over this in my head.
> Strengths - What strengths does my personal financial life have? Do I have good income, low debt, good credit, or good habits?
> Weaknesses - Opposite of the above. Do I have poor habits?
> Opportunities - What opportunties are in front of me? These could be a raise, an investment, a business decision, etc.
> Threats - This could be anything and could be boiled down to "Life". But I think that if you have young children, like I do, paying for college could go here.
I do not think that the answers you get are as valuable as the process you would go through in working this out in your mind.
I am open to all comments on this!
Have a great weekend.
Labels: Credit, peronal finance
Cost of a mortgage
What is the true cost of getting a mortgage? I talk to many people and when the cost of getting the loan done comes up, usually one of the questions is about comparing two different offers. The trouble is that getting two offers structued the same so that you are comparing "apples to apples" is quite hard. There are so many variables that it is hard to set them both equal to each other. In addition, so many of the numbers that go into the deal are not "known" and are only estimates.
I found a great post on
Outer Banks Real Estate. In this post, Mr Roach does a GREAT job of line by line comparing one of his loan offers to another offer. The other offer is not fully disclosing the FULL cost of the loan. This is the "apples to apples" problems that I mentioned before.
Thanks Mr. Roach.
Labels: Buyers, Interest Rates
Spring time
I am not going to say this is really something I am going to do myself (smile), but I know that it is something I need to do.
Spring cleaning appears to me to not only be a ritual (where did it start anyway), but it does make sense. Over the winter, things can tend to be put off, so the spring and fall seem to be good times to catch up on that sort of stuff.
Also, it makes sense if you may consider selling. A good deep cleaning is step one if you are thinking of selling your home. So, while you are going around cleaning, try to put yourself into the eyes of a potential buyer. What would they like to see?
Another good investment is a
black light. No, not for some wild party once you get your home really clean. If you have pets, like we do, they have accidents on the carpet. You rush to clean it up and do the best job you can. But did you really get it all up? The black light will reveal the truth. We recently got one and I was SHOCKED at what I say. Not just the pet spots, but just general dust showing up in areas that I never thought to look.
Here is a good article on this to help kick start your brain on what needs to get done.
http://blueroof.wordpress.com/2007/03/11/spring-cleaning-checklist/John
Labels: Home
Your credit identity is at risk!
ALERT: WHAT’S YOUR NAME WORTH?
Your name is worth everything to you…it’s your identity, it’s YOU. Here’s breaking news you need to know…and you need to let all your family and friends know right away as well.
Few people realize that each time their credit is checked, the information provided to the credit bureaus (
Equifax,
TransUnion,
Innovis or
Experian) immediately becomes a commodity that is sold not only to other lenders but also to companies that sell and resell the same names and personal information.
That’s right - The credit bureaus have found a way to increase their revenues at your expense….and without your permission. These ‘inquiry leads’ include name, address, phone numbers (including unlisted), credit score, current debt and debt history, property information, age, gender and estimated income. They are marketing your personal, confidential information to competing creditors and making millions. Your privacy is being sold, not just once, but over and over again.
The lenders that have purchased these leads at a premium will then do everything they can to recoup their investment and turn a hefty profit. Often, bait and switch tactics are being used to lure clients away from their reputable lender.
The good news is that you can make it stop! The consumer credit reporting industry has provided a way for you to “opt out” or remove your name from these lists. You can contact them by phone at 1-888-567-8688 or online at
https://www.optoutprescreen.com/?rf=t. You must opt out at least 48 hours prior to having your credit checked to make sure it is processed in time. You can choose a five year or lifetime option. The lifetime option does require a signed form.
At this time the practice of generating and selling these lists is allowed by the law. If you would like to complain about this or have been targeted after opting out, you can contact the
FTC or your state Attorney General's Office. These agencies will investigate reported violations. In most cases, an agency's primary source of information is complaints from the public.
As a consumer, it is your right to shop for the best service and price for a product, but this should be when and how you want to shop. These unsolicited marketing tactics are a nuisance and intrusive. Take your privacy back and refuse to be a part of this system.
Labels: Credit
Sub Prime mortgage fallout
If you pay any attention to the news, I am certain that you have heard numerous reports of Sub-Prime lenders going under.
This is rocking the financial markets. There are many reasons for this, including the glut of money that was
dumped into the markets over the last 5 or so years. Another culprit is the innovative loan products that were sold to people that had no business getting them. Couple this with VERY loose underwriting standards and...VIOLA!
You have
companies dropping like flies now that their portfolios of loans are defaulting and they are cash strapped.
But what does this have to do with you? Even though you may have good credit, solid job and easy to prove income, this does effect you. It effects you in rates. Obviously, as this shakes out in the markets,
mortgage rates are bouncing around like a yo-yo as Mortgage Backed Securities investors try to figure out how to price their deals.
One other effect of this is in underwriting times. I have a loan in underwriting right now that is taking 2 to 3 times as long as it did 6 to 12 months ago. I am certain that this is due to the fact that, due to the lack of work, underwriters are getting
layed off. So, a loan that would breeze through in the past in about 2 to 3 days, now takes over a week to get done and that time is getting even worse.
Another way this effects you is in underwriting standards. I ran a loan today that, 6 to 9 months ago would have flown through the underwriting engine. But not today. It took some real time and the final deal that I could put together for the client was not as attractive. This is all due to the pressure put on the markets to tighten up the belt. So, it effects you in what you may qualify for, since the pot is smaller and pressure is on the banks to deliver better QUALITY loans, as opposed to
QUANTITY. So, if you have credit that is good, but not great, or if you have some other extenuating circumstances, get involved early. Do not let someone tell you that "we can get that done in 10 days", because that is unlikely. Stay on top of it and understand that, if you are working with a professional mortgage planner, you are in good hands. They will figure something out for you.
The one thing you can count on in the mortgage business is CHANGE!
Labels: Buyers, Financing, General Real Estate News, Subprime
Personal Finance and Strategic Equity
(cell 1) 3-6 Months emergency incomethen
(cell 2) Get out of non-preferred debtthen(cell 3) One year salary (liquid)then
(cell 4) Payoff the mortgageI must give proper credit to this model. It was developed by Jim McQuaig of Nations Home Funding of Reston, VA.
Basically, the model is a very conservative approach to personal finance, and I doubt that there would be anyone that would argue it would not work.
The real strategy comes into play in cells 3 and 4. It is Mr. McQuaig’s belief (and my own) that whether the mortgage is actually paid off or strategically paid off is the personal decision for everyone.
By actual payoff, I mean that the loan is satisfied and a payment is no longer made to the mortgage company. You own the home free and clear.
A strategic payoff is if cell 3 (One year salary in a liquid account) actually continued to grow to the point that there is enough in this account to payoff the mortgage at anytime. You personal balance sheet has an asset (the side account) greater than the liability (your mortgage). You are in a POSITIVE position.
There is much more to this model and this thought process. I will try to share more in the coming weeks. If you would like to discuss this further, or apply a particular situation to this model, call or email me.
Labels: Buyers, Financing, Mortgage Planning
