New Bill Could Improve Millions Of FICO Scores!
Click the post title above to watch today’s video! Catch all your real estate news and mortgage news with Frank Garay and Brian Stevens here at www.TBWSDailyShow.com!
Contact Your Congressman Here: http://www.contactingthecongress.org/
good article. I do not believe medical bills should be on credit reports. My daughter just found an old medical bill on her report that the doc office said she didnt owe but yet billing dept sent it to collections. She never received anything. She applied for a car loan and found out.
Im in insurance and people with so so coverage get it with major out of pocket bills. The docs will work with you to pay it.
Great idea about HIPPA, push congress to say medical should be excluded.
I believe there is already a law that covers medical collections, it is I the HIPPA law. It is violation of the law for a medical professional to share your personal medical record with a third party, this includes credit reporting agencies. Unless you have not paid the bill, then they can make resonanle attempts to collect including reporting to credit agencies…. But after you pay the bill in full then they are in violation of HIPPA if they continue to share your medical information with a third party, so you can have it removed.
While i am for credit report cleanup unless people HAVE jobs, no one can buy a house with or without good credit. Aslo, this bill as someone else said is redundant. This can already be done. We need real healthcare reform for those who go bankrupt due to big illness and big bills. The reason lots of folks lose their homes is due to THIS and lack of work.
Thanks for the link to notify my representatives. I pulled a copy of the bill and noticed that the sponser is Heath Shuler, former NFL quarterback. Played for Washington, I believe.
I like the shirt – Thunder Dan was the man.
Great idea! Although they should, most people don’t plan on getting sick. This also helps the medical provider get their money-which is all they wanted in the first place! Everyone wins!!!
Thanks for the link to connect us to our legislators. Did – asked all three to support the bill. Haven’t heard about it from my local association, so thanks for the heads up!
kp
What the Heck are you doing? Are you Stupid? Why? Why? Why should a person have to get the Gobernment to tell people to stop putting Doctor Bills and things that any collection agency who Put things on your Credit Report? What the hell are you doing? Why not tell these Collection Agencies that they must go through Due Process, ie Court, some type of legal action to put these things on a Credit Report!!!
That is how you fix this, Not the Stupid way you are saying. Get Congress to put this into a Bill, then you can get one to pass that Actually Helps the consumers! Get off of this “If you Pay” and act like a reasonable person.
Visit the fair tax site watch the vids and get behind it.
http://www.fairtax.org/site/PageServer
Please all of you go to this site and watch the u-tube vids. once they start they answer all the questions. We need to get behind this proposal.
It really is very simple and fair.
http://www.fairtax.org/site/PageServer
Are Medical collections that big of a deal for people? Most consumers with a great mix of credit who are credit worthy don’t get hit too hard (on thier FICO scores) for medical collections and most lender don’t even require you to pay them off, SWEET. This is the least of my worries as an originator… Just sayin’.
Here’s another solution.. many believe Paul Volcker to be the last great Federal Reserve Corporation Chairman. Despite the obvious problems of having a private corporation of bankers control our money supply and charge the American people interest… for now at least, we can try to offer solutions because abolishing them will require a tremendous fight. At which time, they will use that control of the money supply to inflict great pain on the people to convince them that the Federal Reserve Corporation is necessary.
Until that time the people can gain control back, for the people, here is a good change for the banks. http://www.marketwatch.com/story/bank-regulators-move-towards-volcker-rule-2011-10-11?siteid=rss&rss=1
Hey Frank & Brian – Will you be compiling a “how-to” book from the responses to your request on Friday? I’d like to see that sifted through and posted back to us. Thanks
Last time I’ll read the “comments” section.
The pity party isn’t for this guy….
HR 2086 has been “in committee” forever… will it ever get out? A majority of them don’t. IT SURE SHOULD, but when the blind are leading the blind and numerous special interests are taken into consideration, it sure makes for increasingly poor odds…
Frank & Brian,
Your Headline: Instead of saying “New Bill Could Improve Millions Of FICO Scores”….you may want to mention in the Headline which BILL you are talking about, because including myself – the first thought was that you support OBUMMERS SPENDING SPREE/UNION PAYBACK – that he calls ‘jobs bill’. I am sure and would bet that a lot of people who saw your headline don’t even watch the video and will say that you support OBUMMERS UNION PAYBACK – I myself was close not to watch the video and just to delete it.
Why would an educated consumer do business with a company that tells them they don’t need an appraisal? You better believe UHM does an appraisal and it’s called an AVM and the borrower pays for it… Somewhere. As a homeowner, I would want a legitimate value based on the current market and not what some BS lender says.
you’re not alone in your criticism. i’m not terribly fond of the ad. great company though.
I believe that they are saying that you don’t need an appraisal if your AUS findings don’t call for one, or give you an appraisal waiver. You’re only going to get that on low LTV files but it is nice to not have an appraisal when the property clearly is worth twice as much as the loan. Most lenders will still make you get that appraisal regardless of the waiver.
Common appraisers… The UWM deal is not posted as a jab to our appraisal community. The bottom line is that DU occassionally will give some document relief for a really strong buyer in a strong equity position based on county records… Trust me when I say, it is not giving it all that often and not enough to really impact your business. HVCC and AMC’s is where you are getting screwed and everyone knows that. Just like the Brokers are getting screwed by the safe act. When you a given lemons make lemonaid… UWM is a good wholesaler who has been impacted no differently than all of us. If they are advertising something that gives them an edge in the market, how can you blame them… or blame TBWS… Do what we are all trying to do… Deal with it! Make lemonaid!!! Sorry to hear that you are making less per deal… So am I!!! Do more! it works…
I used to have that same Farrah poster in my teen age bedroom.
I closed a deal two months ago on a CalSTRS buyer. Since the 1st in FNMA and we all know FNMA is very credit score driven, I had to share this story. The credit report was pulled right before funding, and a $67 collection from a Dentist showed up that wasn’t on the upfront credit report. The problem wasn’t paying the $67, it was her credit score that went from 707 to 686. This caused a 1.25% hit to her closing costs. She had to pay an extra $2,600 in closing costs which goes to FNMA for the credit score dropping. That was unbelievable to me, how can the loan only be acceptable if she coughed up another $2,600 at closing because of a $67 Dentist’s bill? Anyways, we closed it, but this system stinks for buyers. It’s not o.k. for anyone to add fees at the end, unless your the govy apparently. Maybe this new bill will help BS like what this buyer went thru to buy.
If any of you thought sticking pins in your Barney Frank Dolls would help, you forgot the ringleader, Elizabeth Warren. She is the real Darth Vader leading the charge against brokers
http://www.vanityfair.com/politics/features/2011/11/elizabeth-warren-201111
There is a huge area that is being overlooked and is no longer available for financing. But as some of you have so well put, if it’s a streamline Refi of some sorts, regardless of the appraisal at this point, as this seems contain its own controversy; and that is the 720, 740, 800 credit score borrower, that unfortunately has a 6 or 7 or even 8% rate on their primary, second, or even investment property, but can’t verify enough income to qualify for the loan, but continues to have perfect credit and has never had a mortgage late, and has 6 months PITI. I say leave the income section of the 1003 blank, so there can be no FRAUD, just like other streamline programs, and let millions of Americans refi to historic low rates. I know literally $100′s of people personally that could save 100′s and some even $1000′s per month is they had the opportunity to Refi. Just imagine if these people could save all this money, how much more stable would that person be, to further ensure continuance of monthly payment, as well as possibly spending this money into the economy therefore stimulating economic recovery, without the need for government stimulus, since consumer spending is such a large part of GDP. All these people are being left behind. I know some of you will argue that if they can’t prove the money they shouldn’t get the loan. I’m not talking about new loans, just Streamlining existing loans, and for millions of Self-Employed borrowers with great credit, who are making their payments, have deductions which are the monthly expenses WE all pay with our NET. So it’s all the same, except they can’t add back all those expenses to raise their income, but the tax laws allow for those deductions. Again this would stimulate the economy and put more homeowners in a better finanical decision.
Again, the Fed’s regulate our banks (or do they?). The banks took our TARP bail-out funds with no requirements. In the case of OneWest, they acquired IndyMac’s book at a deep discount, and made that infamous “no-loss” sweetheart deal with the FDIC (from the original loan amount – wow).
Since the hope of modifications are a joke, why doesn’t the Fed simply require across the board 3-4% loan rates on the remaining ARM loans. A bold regulation would certainly keep millions in their homes and eliminate millions of excess inventory clogging the resale market for years to come.
UWM splashing away on the screen….NO APPRAISALS….Thanks Brian & Frank for allowing your advertisers to throw the appraiser under the bus. It hasn’t been hard enough!!
That program only affects a VERY small percentage of loans. Not to worry.
Using that logic, Hitler only invaded Poland……..not to worry..
your welcome…. however i hardly think uwm is your biggest problem. they, like all companies and individuals are trying to find their place in the industry. knowing that they have forward commitments i hardly think they have the power to systematically stop getting appraisals on their products. in fact i know thats the case. i would suggest you call them and find out what their doing before you (ooops you already did) throw them under the bus. i know the staff and management of uwm and i can tell you that if more were like them, we’d all have a healthier business. i understand your frustrations about what has happened with the appraisal industry & we are in the throws of launching a call to action with naihp regarding the problems with appraisals. we’ve been huge supporters of individual appraisers and will continue in the future.
Great idea, pass HB 2086 and have all the people get a conventional loan without an appraisal. That puts more people to work as you said, and it puts the appraiser out of work. Thanks for supporting the appraisers, we don’t need the low cost paid by MNC;s anyway, we didn’t get hurt by the down turn, we’re all rich and don’t need the work like LO’s & Realtors. Great job guys, to hell with appraisals/appraisars and their job.
Right on ! Can’t wait until they lend on the abandoned shack and the Investors want their money back !
I’m always leery of government involvement in manipulating financial risk instruments – especially based on the track record of the last 10 years or so. But can someone explain to me why, if the debt is satisfied, this should NOT come off of a credit report? Usually when someone takes on a medical expense, it’s at a time of emergency or stress – not (theoretically) like a credit card, mortgage or auto loan, when a person hopefully is making a sober request for credit. If a person got thrown into an emergency situation requiring medical care, satisfied the obligation, but maybe not within the timeline that fit within the parameters of the credit agreement, it just seems punitive to also ding them on their credit report – which is continuing to increase in importance in today’s world. It’s an honest question – I hope I get some honest answers.
@Rob – Although I am not a decision maker at a lender, I’ll try to put it in a similar way it was presented to me; they are concerned that if the consumer found himself unprepared for a medical emergency of a few hundered dollars and had to go into collections as a result, what would he do if his roof started leaking and needed to be replaced in a hurry?
The logic may not be sound, but the concern is legitimate.
Knowing 1/3 of your viewers are Appraisers why the heck would you post another Slam towards Appraisers?! How you can close Conventional Loans without an Appraisal? U.W.M. must pay you so well you have decided to AX all Appraisers from your viewing population. Thanks Brian and Frank, you sold us out too.
2 thumbs up !
check my response to an earlier post.
It is never a good idea to allow the government to manipulate risk assesment vehicles. It is difficult enough for a ratings agency to determine actual risk in a transaction or of an entity, but if you handcuff the ratings agencies and tell them that by law they are not allowed to use certain factors, you have weakened the system. Sounds like something Barney Frank would think of, not Frank Garay. To quote the Monday Night Football spot when someone does something stupid – Come-on Man!?
I have an idea. Why don’t we just forgive the debt altogether! And even though that’s considered taxable income, we’ll just keep turning our head and continue to not enforce that either. Maybe we should just give everyone an 800 credit score, regardless of their pay history! After all, isn’t it just hurting their self esteem and discriminating against them to actually give them a low credit score? Maybe we should force the banks to lend money at 0%. Nobody should really have to pay interest on borrowed money, and the private industry is the devil for actually making a profit. I’m sure most of these people have sacrificed many things in their personal budget like cable, cell phones, eating out, etc.
Do you people really think that once the interest rates are lowered, and credit scores are erroneously increased, these people will have learned anything? They still will complain and won’t pay their mortgage, because what they really want is to get out of the debt, so nothing short of that will change their victim mentality. I’m all for figuring out a way to get the economy going, but letting people off the hook for poor financial decisions on major purchases is STUPID! We might just as well turn our country over to China right now.
I see a lot of small under $100 collections that people find out is a result of their own insurance paying slowlly. Even after they are paid they stay on the report, killing their score. What we have here is a failure to understand the impact of medical bill collectors upon people at their lowest moment. If your medical provider couldn’t humiliate you into settling your bill, perhaps health care would be forced to become..I dunno…more caring?
Sounds good on the surface to pass a bill to remove paid off medical collections from credit reports … but it just seems scary that the government is writing laws to manipulate private industry. Just how regulated are FICO scores? Isn’t that how health care insurance got out of whack?
Seriously?! How long have you been in the mortgage industry? You never look at erroneous credit reports? Without legislation they would be even worse. Credit reports have too signigicant an impact on people’s lives not to be regulated.
The failed billion dollar program you are talking about, well, I was excited when I heard about it, but alas, not for my state, Indiana. I am a Mortgage Broker, definately underemployed, I would have benefited greatly from this. When will they make rules the same for everyone?
Rick, how can I find out about the “failed billion dollar program you are talking about” that wasn’t applicable to Indiana? Please give me a lead for researching. jdpike@parkaveaz.com
These people are deadbeats and should be reported as such on their credit reports, especially when the average balances are peanuts.
Not so..my neighbor who has a great credit score was turned down for a refi because there was a “reference” to a medical collection which was an error in the first place and remains on the credit report. Get real….it’s like living with under the Gestopo.
Ha! You rent to those deadbeats, Mr. Rental Investor! It sounds like you just don’t want anybody messing with your base.
Medical collection accounts should not hurt someones credit score, they often sneak up out of nowhere–especially when they are the result of slow paying health insurance companies.
I certainly hope you never get sick, Mr. Rental Investor, and flush your good credit down the toilet with one medical collection that can drop your score by 60 points or more. We wouldn’t want to have to call *you* a deadbeat.
The absolute, needed, desired, best thing we can do for the economy, our country, our world, our future children, & grandchildren. Is to have influential people, like Brian & Frank, start the dialog on getting rid of the federal reserve.
The Federal Reserve is a private company directing our congress, news media, President, & other world leaders into paying them for our own money & then charging us high interest rates to pay them back. This “World Order” we keep hearing about from time to time is a sell
out of our country & our freedoms. We have
been losing our freedoms steadily over the last
100 yrs. The Federal Reserve w/ the Big money people around the world are controlling governments and the people.
As bad as our congress is it needs to vote out the Federal Reserve & take control of our own currency again. Until we do this & take the first big step in controlling our money, we will continue the down hill slide of losing our awesome, the greatest Republic, not democracy, in the history of the world.
I hope u will consider some of these things and at least do some research to determine how we can get the word out on this “cancer” that is killing our nation.
Thank you for your time & please keep up the awesome job u both r doing.
Sincerely
Steve Reeves
Right on bro.
A good start on that would be everyone getting on board the fair tax proposal. Which would eliminate the IRS and all the thousands of rules and BS. That would be the most stimulating thing that could ever happen to the country. If you haven’t done so, go get the Fair Tax proposal book and read it.
Everything we are talking about here is all wraped up in this system of corruption. It makes no common sense to continue, it is clearly designed only to control the world and funnel the wealth and control to traditional sources. If we don’t kick it now we will all be paying our taxes to the UN very soon.
Hey folks has it ever occured to any of you that if 50% are not paying any taxes a tax credit is not going to work? And maybe thats why they are not working anymore!
On the original subject, I agree the credit report should be purged of medical paids. and by the way an 800 fica does not necessarly mean a man is going to keep his job or his health.
I’d like to see where they came up with this $456 average. You can’t go to the local doctor for under $500 a visit these days. Minor surgery at the hospital cost around $5K. I once broke a bone in the late evening, went to the hospital, they took X-rays, and did all these test and sure enough it was broke (duh) and when they finished all this all they could do was wrap it and tell me I have to go to a specialist to get a cast put on. Never said they couldn’t put on a cast when I first got there and said “I broke my bone”. Well my hospital bill was $1,500 and the specialist was another $950. Would have been more put I was so mad when the time came I took the cast off myself.
Just a few months back my family member had to pass a stone but, didn’t know that was what the terrible pain he had. Went to the hospital late one night because the pain was so bad. Stayed 1 day in the hospital and passed the stone at home. Got his bill. You want believe this, over $17K.
I don’t believe the average is $456 that is owed and the $2500 are lower won’t do a thing because those are the ones that want be buying a house anyway.
As far as the money the government was giving away there was no way it was going to happen. Why, because they didn’t let anyone know about it. Ask a hundred, thousand people about it and see how many any knew the program was out there.
I’m very negative today from your info. I just wish the government would go back to doing their job and STOP screwing (I really have another word) with my real estate market. The RE market will take care of itself. There are way smarter people in the market then these vote collectors.
Thanks and I hope you have a better pick me up show tomorrow.
There is no reason why each financial institution can create a “streamline refi” no appraisal required. They can adopt the guideline of the VA IRRRL. There is nothing in the regulations that requires a lender to have an appraisal if it makes sense to do the loan. If a regulator had a problem it is justified with a response of ” It was in the best interest of the borrower”! Problem is lenders don’t want to lower the rates on the borrowers (who are stuck due to value) that are in their current portfolio because then they have to look at there deposit rates and how it will effect the ALM Ratio. But as I have argued since this all began. It will be offset by the amount of money freed up for the consumer to invest more, save more not to mention in fee income!
If appraisers are out of the picture there would be no one left to blame when things go south.,…perhaps then they would take a closer look at other aspects of the mortgage loan business….what area do you work in?oh thats right the backstabbing, I’ve got mine so screw you division……..
Janetta. The ‘lender’ doesn’t set the rules for sllability of the loan in the secondary market. That factor is determined by the restrictions within the security the loan goes into. VA IRRRL’s are allowed by VA Guideliens, yet I can’t find a lender who will do one without an appraisal and then will cap the LTV to no more than 110% (one lender) or less. If you know a wholesaler doing pure IRRRL’s, let me know (benchmarkhomeloans@cos.net). Fannie & Freddie from time to time have allowed streamline refi’s. Same issue – if you can’t sell the loan, you can’t close the loan. MBS’s are not currently allowing these loans to be included.
Roadking
If Appraisals are not done on property (UWM) who will the banks blame when the loans come back??????
Broke Appraiser: Let’s see, in the first place UWM pays appraisers below market fee for appraisals (I checked), but that’s not enough….how about just bypassing the appraiser completely. The appraisal profession is so over. Can you say “would you like fries with that?”
Funny
Just closed a UWM $69000 FHA purchase
cost of the appraisal= $450
I wonder how much of that fee the appraiser pocketed……you can bet your bottom dollar it wsn’t $450.
The APM’s are taking most of the profit and paying the appraisers very little.
The AMC’s are taking most of the profit and paying the appraisers very little.
and remember there is NO part of the mortgage loan process that cannot be removed if the lenders want or require, its their money its their rules….but when that happens to your job, there will be less appraiser supporters to rally behind you when you are also saying “do you want fries with that?”
If the client has good credit and has great payment history on the mortgage, why wouldn’t the client keep paying on the loan if the new mortgage note was lower?
Hi Brian & Frank,
One of the ideas I would like to get out is concerning the FHA Streamline Refi program. It has long been a great way for FHA clients to take advantage of an advantageous interest rate market however with guideline changes to this program earlier this year it is not making it possible for clients to take advantage of the great rates. In the past if the interest rates dropped you could get into this program without doing an appraisal and basically lender paying all of the closing costs so it was a great way to give your past client or a new client a value added service. Now HUD is requiring the client to reduce their P&I + their monthly MI payment by 5%. The problem with this is the MI Factors have in some cases doubled (.55% in years past as opposed to 1.15% now) so even if you lower a client’s rate by 1.5% in some cases they dont qualify which forces them to have to get an appraisal and with values down so much over the last few years it kills the deal and prevents the client from lowering their payment which obviously causes them to not be in the best possible financial situation. Wouldn’t a better solution be to keep the MI Factor on their new Refi the same as what they closed with originally so the MI factor was irrelavent which would show the true benefit to the streamline Refi program? Just a thought…
So true! There are countless homeowners effectively locked out from refinancing by the recent changes in FHA guidelines. One suggestion; existing homeowners could be grandfathered providing them an opportunity to refinance their FHA loan under the guidelines which existed when they first took out the original loan.
Great idea!
Another onerous guideline change affecting good FHA borrowers, not being able to cut term even under the qualifying streamline guidelines…. If the property is under water wouldn’t it be less risk for HUD to allow the borrowers to paydown principal quicker?
This is a no brainer. With the recent change in April 2011 of the new monthly MIP, so many of my clients can longer take advantage of the FHA Streamline program. In order to make it possible, we need to bring just about every client down 1.25% – 1.50% to even meet the required NTB. Also, when that NTB requirement is met, the savings is still very minimal because their monthly MIP (in some cases) has literally doubled…taking away any significant P&I savings. If they are worried about default issues with these borrowers, then overlay the mid scores to 660 or 680…it doesn’t matter. There are still plenty of qualified borrowers out there that are prime candidates for this once great program.
Great post! FHA needs to keep the same monthly MI so customers can take advantage of the lower rates. Otherwise FHA streamlines are DEAD.
Explaining the bill process and why sometimes the House and Senate have bills of their own accomplishing similar goals might make a good episode.
http://www.govtrack.us/blog/2008/10/17/if-the-house-version-is-defeated-does-the-senate-bill-die-too/
Remember this? http://www.youtube.com/watch?v=mEJL2Uuv-oQ
Darrell Catmull
Destiny Real Estate
801-810-7325
Hi Frank & Brian,
http://www.congress.org is a great site where you can register, receive alerts, be notified how your Rep or Sen voted, and conveniently write all your Fed and State Reps with an online mail merge. It passes through their Spam filter and is recognized by their staffers as legit.
I usually receive snail mail responses from my Rep but less often from my Senators — unless their running for re-election of course, then I receive a response on every letter I send through http://www.congress.org.