About these mortgages ,what is wrong with the mortgage rate staying at the same as they were took out .?

Question

If the mortgage companies was makeing money at 7% then they can stay ther an still make money

Answer 1

There are a lot of guilty parties to the virtual implosion of the mortage banking and real estate industries. There are a lot of victims as well. It was my belief for a long long time that if one cannot qualify at a full documentation 30 year fixed for the home that was up for purchase or refinance, then there should have been no loan at all. However, there was much fraud running rampant, Greenspan was lowering the rate, and lenders were pushing to get the numbers. Loan officers were not fully making sure that their clientele understood the ramifications of the Pay Option ARMs, where the lowest option of payment would actually cause negative amortization. These very Loan Officers were only concerned with closing the deal and getting the huge yield spread paid on the back-end by the investors. If the government does not get involved, this whole country will suffer. This problem will run over into other industries.....automotive probably being the next, if it has not done so already.

Yes, I believe in personal responsibility....but then again I believe that it's the resposibility of everyone involved in the financial undertaking (lender, seller and all other parties involved) to make sure that what is transpiring is the most beneficial for EVERYONE involved (most of all the borrower).

Go to http://www.ml-implode.com and keep informed about the seriousness of all of this. Spifiman, your statement is too general and it does not cover the broad spectrum of what is involved.

This will affect everyone, somehow some way!

Answer 2

The point is though they were adjustable rate mortgages, so the mortgage company has every right to adjust the rate upwards. They are in it to make money and if they adjust the rate upwards, they make even more money which is their ultimate goal. It's certainly not "fair" business practice, but that is the risk of taking out an ARM to begin with.

Answer 3

That's what happens when you take a fixed mortgage. Folks who wanted lower interest rates or needed some kind of "creative" financing went the ARM and/or interest only route.

Answer 4

That's not the point, the customers did not qualify for a fixed rate of 7% they qualified for a adjustable rate.

Once again you have a case of people whineing when the lenders do exactly what they told them they were going to do.

I don't think the Government should get involved at all, let the lenders take their losses and let the people lose their homes if they cant make their payments.

But, then that's just me, I belive in personal responsibility.

Answer 5

That is what is known as a fixed-rate mortgage. Many of these "subprime" loans had artificially low introductory rates with reset mechanisms and people should have known going in that those are dangerous.

Answer 6

hi Neil: My question is why are not you asking your person loan broking provider those questions, inspite of each little thing, they are going to be getting a fee out of you? additionally you probably did no longer point out what your activity fee is, and evidently like this own loan is adjustable. at present i might attempt to stick with a fastened 30 3 hundred and sixty 5 days. own loan. i'm no own loan broking provider yet I surprisingly recommend you carry out a little assessment "figuring out to purchase" with different financial institutions in the past you commit to something. belongings supervisor/Realtor Boston, MA

Answer 7

Cali-Gal gave an excellent response and I totally agree with it