Rather than beating up on home lenders and accuse them of intentionally targeting borrowers who were in over the head, CNN took a more instructive approach.
The April 14 edition of CNN's new business show, "Issue #1," showed that there are ways other than whining and moaning about how you were victimized by an unscrupulous lender. A Brooklyn, N.Y., homeowner on the brink of foreclosure sent a letter to a lender asking for some leeway on her mortgage payments.
"I'm a single, divorced mother living alone with my children," Jillian Simmons said to CNN, reading the letter she sent to Fremont Investment and Loan (NYSE:FMT). "Please lower my rate from 7.95 percent I have at the moment so that somehow my payments will be more affordable and changed to a fixed rate. Thank you, Jillian Simmons."
Fremont did more than that - they offered her a deal that lowered her payments significantly.
"Fremont Investment and Loan did more than Jillian had asked," CNN senior correspondent Allan Chernoff said. "The bank lowered her interest rate by three percentage points, dropping her payments by $1,000 a month and made the loan a fixed rate mortgage, to keep her monthly payments constant."
Compare that to a story on the April 3 "World News with Charles Gibson." That report showed a family with an income of less than $30,000 a year that managed to get a loan for a $335,000 home.
This family managed to hold on to their home by suing their lender and claiming victim status. They claimed they were duped by a predatory home lender and the court allowed them to stay in their home. "World News" portrayed it as a "victory for the little guys."
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Wow. What a sucker I am! I
April 14, 2008 - 18:32 ET by zhombreWow. What a sucker I am! I bought a house that I can afford, on a fixed rate mortgage from the get-go, and have made all the payments even when they increased to cover escrow shortfall for taxes and insurance. Boy oh boy do I feel foolish now. I'm victimized by not having played victim. Is there no justice?
zhombre... How could you
April 14, 2008 - 18:42 ET by Clear thinkerzhombre...
How could you be so un-American as to not play the victim card?
"Abstain from McCain"
→ ClearThinker
April 14, 2008 - 18:49 ET by Cool ArrowNo, I'm the idiot.
I lost a house in the 1980's because I bit off more house than I could chew.
I've since paid off a better house and refuse to encumber myself with any kind of credit. I pay off the same gas card every month.
I am the wiser because the government wasn't there to pity and coddle me.
Lessons can be painful, but nanny state is disastrous.
♣ a seal
Cool... Well done! We
April 14, 2008 - 19:01 ET by Clear thinkerCool...
Well done!
We have one credit card between the wife and myself which is carrying a balance of zero. We paid off all our other cards almost 10 years ago, then had a credit card cut-up party. We never, ever buy on credit anymore. And our dream house is paid in full.
It's either pay the full price up front or we don't buy it. This one change in our behavior has saved us tens of thousands of dollars.
I once had a relative tell me that it's not good to go without using credit because it makes your credit score go down. I politely told him that I don't care about my credit because I don't want credit. He still thinks I'm the crazy one.
"Abstain from McCain"
→ Absolutely Clear
April 14, 2008 - 19:06 ET by Cool ArrowFurthermore, I have never owned a new vehicle, and have paid cash for them for the last 18 years.
My parents learned from WWII. I learned from my own Great Depression 19 years ago.
♣ a seal
Me too - I NEED a bailout!!!
April 14, 2008 - 23:29 ET by FastEdGot about 4 years left on a 30 year, been on time, but don't want to finish the same way - gimme, gimme, I'm a victim too - of hard work and honesty, and have read the details, so - when do I get the break that the dummies get? Just enough money, if only to save ONE payment! (sound like "if only to save one life" anti-gun sayings??)
There is no sense in being stupid, if you can't prove it! - my dad V
You have no choice, .
April 14, 2008 - 22:04 ET by seanrobinsYou have no choice, . . .
. . . but to sue yourself!
sean robins
www.seanrobins.com
Is this another welfare
April 14, 2008 - 18:43 ET by ThisnThatIs this another welfare handout, paid for by home owners like myself? How does a company justify reducing rates for one individual (who, by the way, can't afford her payments) and not for me? Why should I have to continue high payments just because I'm not in default? I don't get it.
___________________________________
If you can read this, thank a teacher. If it is in English, thank a Soldier. - My barber
TnT, I understand your
April 14, 2008 - 18:59 ET by motherbeltTnT, I understand your frustration, and sympathize. But lending companies, mortgagers, even credit card companies negotiate all the time with those who are in over their heads. They settle for partial payments on a regular basis. There are PSA's on TV, advising people to do just that if they find themselves strapped, as opposed to filing bankruptcy. I saw one that said don't call one of those debt consolidation companies; call your creditors yourself and work out an arrangement.
Maybe the mortgage lender was glad to actually have someone request help rather than just defaulting, and figured helping out was worth it not to have to take over another house right now.
You and I and everyone have the right to call our credit card companies and request a lower interest rate...I have done it and succeeded. I once got a reduction on my phone bill for 6 months because I called and said "you offer all this great stuff to new customers, how about the ones who have been loyal customers for years?"
If you don't ask, you don't get. ;-)
Don't worry. You'll get
April 14, 2008 - 19:07 ET by zhombreDon't worry. You'll get it. Just bend over.
Responsible people who pay their bills and pay their taxes will serve as aggregate ATMs so the politicians can slap some extensive and expensive Band Aids on a problem and thus appear "responsive" and "compassionate" and can "level the playing field," "help those in need" who are "victims of corporate greed and predatory lenders."
Get it?
motherbelt is spot on
April 14, 2008 - 19:31 ET by mojo_jojoI have been in banking and insurance my entire career. And while it is not ordinary, it is customary for some lenders to recast their loans with willing borrowers rather than let the property go into default. Even in supposed "hot" markets, lenders never come out ahead on a forclosed mortgage. And the squeeky wheel gets the grease. Believe it or not, but collectors find it odd to have a mortgagee call them looking to negotiate to avoid the doom of losing one's home.
My two cents
April 14, 2008 - 20:37 ET by iveseenitallI've lived a long time. Never been in "debt". Sleep well at night. I'm also a "lucky" guy, thank God. Got a good, smart, frugal woman for a wife. Stay within your means and you'll be happy in the long run.
NEVER,NEVER trust a "liberal"
Sad, but the first thing I noticed
April 14, 2008 - 21:53 ET by mom_roxI'm not sure what this means, but the first thing I noticed was that the borrower used "please" and "thank you" instead of "I'll see you in court". How refreshing.
=> iveseenitall - I don't know your personal situation, but your response reminds me of the book, "The Millionaire Next Door" which states that most first-generation millionaires became affluent by living well below their means. It also claimed that the affluent tend to answer "yes" to three questions: 1) Were your parents very frugal? 2) Are you frugal? 3) Is your spouse more frugal than you are?"
A government that robs Peter to pay Paul can always depend on the support of Paul.
- George Bernard Shaw, 1944
Great Book, mom
April 14, 2008 - 23:37 ET by iveseenitallMom_rox:
I read that book a while back and I agree totally with what it says. If I remember correctly, the author states that you would be quite surprised at who the millionaires are; they don't appear to be, but they are. It works; I know from experience. And "yes" to all those questions.
P.S. Another knock against the "liberals". They've given such bad financial advice to our kids. They've hurt many more than they've helped with their loony ideas. Conservatism works, even with your finances.
NEVER,NEVER trust a liberal
"Is this another welfare
April 14, 2008 - 20:47 ET by ckc1227"Is this another welfare handout, paid for by home owners like myself?
How does a company justify reducing rates for one individual (who, by
the way, can't afford her payments) and not for me? Why should I have
to continue high payments just because I'm not in default? I don't get
it."
Well, you could always contact your mortgage company and ask them to reduce your rate if you like.
When I built my home back
April 14, 2008 - 20:13 ET by SpockWhen I built my home back in 1993, I refused to even consider an ARM. Fixed rate was the only thing I would consider, even though you could walk into an ARM for a lot lower starting rate. If all had gone according to plan, I would have made my final payment in June 2009. Unfortunately, I lost my job last month and can no longer afford the $2000.00 I had been paying. Thankfully, my wife is still working and we immediately contacted our lender. 30 minutes later, we had a new fixed rate loan for the remaining balance for $400.00 a month.
It sucks that I'm looking at another 15 year note but what are you going to do? At least the bank doesn't have to worry about my payments now and once I get back to work, I'll go right back to what I had been paying (no penalty for early payoff on this loan).
Anyone in Virginia need a good Network Security Administrator?
Spock: This may be a shot
April 14, 2008 - 20:25 ET by QueenMumSpock: This may be a shot in the dark, but if Lynchburg isn't out of the question, I recommend my husband's former employer.
Don't have any current information re: job opportunities, but it doesn't hurt to check.
I am the exotic Queen Mum, and I approved this message.
I appreciate that
April 14, 2008 - 20:34 ET by SpockI appreciate that Mum.
Lynchburg would require a relocation for me, but I'll check out your link anyway. If I don't move (and I really don't want to) I would need something somewhere between Richmond and Quantico. But don't let that stop you from suggesting! =)
Thanks! And may you Live long and prosper!
Foreclosures
April 14, 2008 - 21:56 ET by GoodieQuick question. Why is Jimmmay Carter in Syria and not in Brooklyn building Jillian a new home? Maybe he would build her one in Venezuela.....