Comments on: An Appeal for Credit Amnesty https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/ Luxury Homes, Lifestyle and Travel Fri, 09 Jan 2015 15:11:57 +0000 hourly 1 By: Revisiting An Appeal for Credit Amnesty | San Diego Real Estate and Homes for Sale : San Diego Real Estate and Homes for Sale https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-69339 Fri, 09 Jan 2015 15:11:57 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-69339 […] wrote this article a year ago for Luxury Home Digest, and thought it might be time to revisit the idea (see […]

]]> By: Revisiting An Appeal for Credit Amnesty | Carlsbad, Encinitas and San Diego Luxury Real Estate https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-587 Tue, 09 Sep 2008 05:47:10 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-587 […] wrote this article a year ago for Luxury Home Digest, and thought it might be time to revisit the idea (see […]

]]> By: Vera Harrison https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-586 Tue, 09 Sep 2008 03:38:50 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-586 I think that credit amnesty is a great idea. In the bible there was a time period when the debts of borrowers were released and of course they were freed of all owed debt. The credit scoring system is tricky as well as many creditors. My husband had a pretty favorable score(680-720) back in 1999-2003. Due to our lack of understanding mortgage terminology, we had mortgage brokers as well as banks that took advantage of us. To top it off my husband was out of work due to a work related injury that required two operations. He was out on workmans compensation for four years. The entire experience cost us everything we owned including 5 rental properties. When it rained it rained. We paid out thousands of dollars to keep properties within the time frame of trying to sell, only to have the mortgage company take them because we missed a payment down the line again. Again, all of this was a result of a work injury. I did my best to help but my husband’s income far exceeded mine. Nevertheless we are still suffering till this day because with the injury came the inability to work, and with that came mental depression and the roller coaster stayed downhill. After many attempts to get help from the Banking Department, I left my prayers in the Lord’s hear and here we are today with some regulations being put in place. No one cared about us nor our 3 children and how we were thrown out of our homes due workmans compensation laws, lawyers, and the employer trying to starve us out as they put it. We filed bankruptcy to stay a float but that did not help either. So until you go through a MAJOR financial disaster as we have experienced please don’t be too quick to judge. Credit Amnesty is on my prayer list everytime I think about it because going from owning 8 homes to renting and paying 21% for purchases just keeps you in the hole. They do have credit amnesty for auto purchases maybe just maybe this can really come to past. May the Lord keep you and may you never, ever experience financial devistation like we have experienced.

]]> By: Billy Taylor https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-585 Sat, 10 Nov 2007 18:37:25 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-585 s opinion FICO scores were abused in the past five years as the secondary loan market lowered FICO score requirements to allow "Stated Income" into every risk category. And "Stated Income" allowed too many borrowers to borrow more than their actual income supported. It was no longer just a streamline method to underwriting, once reserved for your better risk clients or self employed borrower. In fact as home prices soared into 2005-2006 most everyone had to use stated income in order to qualify for the lofty prices...and that's another long dicussion for another day. Although I don’t believe we will ever see the elimination of FICO scores or the adoption of a blanket credit amnesty in mortgage lending. We may see more of common sense underwriting that does allow foreclosure forgiveness after a one to two year period with some exceptions. Keep up the good work Regards Billy Taylor]]> Roberta,

Maybe we should eliminate FICO scores entirely?

I originated and underwrote loans for years without the use of FICO scores. I was able to evaluate a clients credit worthiness without an arbitrary credit score. And if you ever ask Trans Union, Experian or Equifax how they came up with a particular score on your client they would refuse to answer. They said their credit scoring was a proprietary business secret.

And a very profitable secret to sell I might add…

When we read a credit report before FICO scores were used we would view a foreclosure or bankruptcy on a case by case basis. Usually if they were two years out of foreclosure or bankruptcy they were fine to borrow for a new home. And if they were less than two years out of their foreclosure or bankruptcy we could ask for an exception if they had a good explanation, like a divorce, death to head of household, illness, etc. So we can always go back to industries previous common sense methods to underwriting.

In fact in this loan broker’s opinion FICO scores were abused in the past five years as the secondary loan market lowered FICO score requirements to allow “Stated Income” into every risk category. And “Stated Income” allowed too many borrowers to borrow more than their actual income supported. It was no longer just a streamline method to underwriting, once reserved for your better risk clients or self employed borrower. In fact as home prices soared into 2005-2006 most everyone had to use stated income in order to qualify for the lofty prices…and that’s another long dicussion for another day.

Although I don’t believe we will ever see the elimination of FICO scores or the adoption of a blanket credit amnesty in mortgage lending. We may see more of common sense underwriting that does allow foreclosure forgiveness after a one to two year period with some exceptions.

Keep up the good work

Regards

Billy Taylor

]]> By: Roberta Murphy https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-584 Wed, 03 Oct 2007 00:55:19 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-584 Cyndee: I know you’ve been busy helping people in the Clearwater, FLA area–and if I run across anyone needing to sell (or buy) in the Clearwater area, I’ll have them give you a call.

This is a market that requires an enormous amount of expertise and sensitivity to client’s needs.

]]> By: Clearwater Beach Real Estate https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-583 Wed, 03 Oct 2007 00:09:47 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-583 Roberta – Enjoyed your article – Made it down to “L’s” – lol. I believe you’re right – the long term impact is going to be huge. I can’t believe how many people I personally know touched by short sales and foreclosures. – Cyndee Haydon

]]> By: Roberta Murphy https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-581 Sun, 30 Sep 2007 01:28:55 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-581 Gena: This is a frightening situation. To disenfranchise such a large group of borrowers could delay real estate market recovery for years.

And I would like to live long enough to see another seller’s market. So would many of our real estate clients!

]]> By: Roberta Murphy https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-580 Sun, 30 Sep 2007 01:24:06 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-580 Kaye: Perhaps this underwriting exclusion should come from Fannie Mae and Freddie Mac? Or FICO scores could be generated with and without the foreclosure. That would encourage people to keep up with all other debt payments.

]]> By: Sacramento Real Estate https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-579 Sat, 29 Sep 2007 22:39:15 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-579 Roberta, this is one solution to hopefully hedge off a recession. If we continue to bury our heads in the sand and say…too bad for all those folks…I believe it not only will come back to bite them but US.

Perhaps, getting the old history books out and taking a look at the Depression might help…

– Gena Riede

]]> By: Kaye Thomas https://www.luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-578 Sat, 29 Sep 2007 21:05:56 +0000 http://luxuryhomedigest.com/2007/09/27/an-appeal-for-credit-amnesty/#comment-578 Roberta.. I doubt we will see any amnesty but we may see lenders take a slightly more liberal view of someone with a credit/foreclosure problem on their record if they can prove it was due to a subprime loan..

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