Predatory Lending
In our mailbox the other day, we received a soliciation for a new mortgage from Solstice Capital. It's one of the sleazier offers we've gotten, and I thought I would take the time to share some of the more infuriating bits.
It arrived in the standard plain brown envelope marked with "Urgent" stickers. By this point in my life, if anyone ever does send me something actually urgent, I pity them because I'm going to assume it's junk mail and ignore it. But eventually I open it up and find an apparent single sheet of paper with a pseudo-check one one side, and the following letter on the other:
Dear Lilisonna,
I have good news! Assuming you have accumulated debts in addition to the mortgage obtained for $145,000.00, you could qualify for a unique opportunity. Here is our simple offer: combine your mortgage and other debts PLUS get an additional $45,000.00 cash in hand for a new payment of $950.00. If this amount is lower than your combined payments, please call us immediately.
(All numbers changed.)
It goes on for another few paragraphs and gives you all the fabulous benefits of refinancing and includes a post script that the program can cover a wide range of credit histories and "special situations" including bad credit of all types.
Only upon close examination did I figure out that the one sheet was actually not just a front and back page, but was actually four pages. It opened up, but there was a little bit of glue holding the pages together. Inside, they had stashed all of the disclaimers and legalese that actually made up the terms of the loan.
Let's look at that, shall we?
Some of our customers have qualified for this example loan...available to individuals with excellent credit histories (approximately the top tenth of our approved applicants). This example loan is based on a first mortgage refinance 2/28 Adjustable Rate Mortgage loan with an interest-only payment feature, a loan-to-value ratio of 80%%, and 2.09$ origination points. The monthly repayment example is based on 360 payments (with the disclosed payment being the initial interest-only payment of $950.00...examples assume that a prepayment penalty option is selected. ..
And now I begin to froth. Of course, I'm not sure if I should be frothing against the lender -- who are clearly being slimy and sleazy -- or against the idiots who would look at this and think that it's a good idea. I want to shake someone until their teeth rattle, and maybe I shouldn't limit that to just one such someone.
Ugh.
It arrived in the standard plain brown envelope marked with "Urgent" stickers. By this point in my life, if anyone ever does send me something actually urgent, I pity them because I'm going to assume it's junk mail and ignore it. But eventually I open it up and find an apparent single sheet of paper with a pseudo-check one one side, and the following letter on the other:
Dear Lilisonna,
I have good news! Assuming you have accumulated debts in addition to the mortgage obtained for $145,000.00, you could qualify for a unique opportunity. Here is our simple offer: combine your mortgage and other debts PLUS get an additional $45,000.00 cash in hand for a new payment of $950.00. If this amount is lower than your combined payments, please call us immediately.
(All numbers changed.)
It goes on for another few paragraphs and gives you all the fabulous benefits of refinancing and includes a post script that the program can cover a wide range of credit histories and "special situations" including bad credit of all types.
Only upon close examination did I figure out that the one sheet was actually not just a front and back page, but was actually four pages. It opened up, but there was a little bit of glue holding the pages together. Inside, they had stashed all of the disclaimers and legalese that actually made up the terms of the loan.
Let's look at that, shall we?
Some of our customers have qualified for this example loan...available to individuals with excellent credit histories (approximately the top tenth of our approved applicants). This example loan is based on a first mortgage refinance 2/28 Adjustable Rate Mortgage loan with an interest-only payment feature, a loan-to-value ratio of 80%%, and 2.09$ origination points. The monthly repayment example is based on 360 payments (with the disclosed payment being the initial interest-only payment of $950.00...examples assume that a prepayment penalty option is selected. ..
And now I begin to froth. Of course, I'm not sure if I should be frothing against the lender -- who are clearly being slimy and sleazy -- or against the idiots who would look at this and think that it's a good idea. I want to shake someone until their teeth rattle, and maybe I shouldn't limit that to just one such someone.
Ugh.