Posted by BarbaraL_CA on 7/8/05 4:07pm
Msg #50649

Bank offers account based on Mortgage - new trend??

This is an article in today's San Diego Tribune - found it interesting and thought I'd share.

http://www.signonsandiego.com/uniontrib/20050708/news_1b8mortgage.html

Reply by Charm_AL on 7/8/05 4:22pm
Msg #50653

wow...interesting. 60% of home buyers in S.D. got interest free loans? I don't know, that program just doesn't do anything for me. I think (from the article) it's scary to give home owners instant access to their equity. If you aren't a great budgeter you can get into some big trouble!

Reply by Notary4U on 7/8/05 5:02pm
Msg #50659

I agree again with you Charm...that happened awhile back when lenders were giving people 100% LTV ...and then the people who had conventional loans at 80/20 they took out helocs for the money at HIGH rates and were then turned upside down when the market dropped and homes weren't appraising. I had clients that COULDN'T sell their homes because they would've had to PAY to get out of it. That's insane. The creative financing that lenders are using can be good, but when some of these borrowers are C & D paper...the bad loan officer/mortgage companies that will take advantage of their situation can (and I think will) be not-so-good for them in the future. I just think that the markets have chnged and the interest rates being so low for so long isn't that good for things. People have gotten so used to then that if they aren't below 6% they think their getting screwed. I have sold houses just after the interest rates where in the teens (1980's) and the normal became 8 1/2%. And when they dropped to 7% it was a great day and I sold so many houses. (More then than now) I think money is virtually free right now and this is will eventually have to change and people are not going to know what to do...especially when they have gotten used to living how they have and when rates go up (and they always do) they will have to learn to stretch their dollars more and that could make or break a lot of people.

jmho

Reply by TitleGalCA on 7/8/05 4:23pm
Msg #50654

Very interesting...wonder what the loan docs would look like for a signing for one of those...

New question for SS: Is this a purchase, a refi or a green loan?