As times get harder for more and more people in this "wonderful" economy we have. I have come across those that are still trying to buy homes with horrible credit. They come in talking about FHA, and a friend told them this....they don't seem to understand that CREDIT is their lifeline to their financial needs. However, I have found a company that seems to work and work well, Veracity Credit Consultants. As many I was skeptical at first till I started sending my clients to them and they started coming back with good scores and clean credit.

One of my clients started with a 498, nothing you can do there, so I figured lets see if they can help him out. 4 months later he comes running in my office with a big grin and ask me to pull his credit. I was shocked his score went from a 498 to a 640! I was ready to go, but he wasn't, they told him to wait a little longer they still had some work to do and hold off. Naturally I was a little upset, but 4 months later he comes running in, yelling, "Pull it now!" He went in 8 months from a 498 to a 720! A 720! No problems now. They removed Judgments, a BK, collections and late payments. After this I sent everyone there and the benefits have been overwhelming.

Yes, I don't have a loan today, but in a few months when times are slow or when you least expect it, here they come ready to get a mortgage, with good clean credit, turning that ugly duckling into a beautiful swan. On top of that they make sure to get me back all my clients as well keeping my name in front of the client the entire time. There are many credit repair companies out there, but as for me the best one I have found is Veracity. The BBB has given them the Ethics award, they once belonged to NAMB, and all of my clients have been pleased. I highly recommend them for ANYBODY that deals with credit. You can look them up on www.veracitycredit.com and check the BBB as well as www.ripoff.com. They have a good rep and in these slow times it nice to know that I have some leads out there that will come back with a smile and mission, refinancing or purchasing, either way its a deal that never would have been. You can contact me if you have questions, but don't let potential clients walk away, especially since it's free for you to too refer them.

I was recently sent this part of a discussion and started to ponder it. Is it really the mortgage brokers fault or is it the banks? 

  ----Well, didn't brokers cause this mess? I mean they created all these 540 programs, right? Then they set the interest rates, pitched the programs to themselves, fooled that innocent couple into signing the paperwork (your TIL was written in ancient Sumerian too, right?), then took all those mortgages and bundled up and AAA investments and sold them off. I mean brokers were the ones with all the fancy performance models based upon ever increasing housing prices, right?

Here's a scenario that would probably describe 80 percent of brokers and AE's.

Lets say you are a horse rancher. You have fast horses, and slow horses, and glue on four legs. One day, your supplier, who has previously bought all of your fast horses, asks you to sell him your slow horses for a premium. You tell him the horses are slow, but he pays you a premium and he seems to be doing well so you shrug your shoulders. Then he comes back and asks you for everything, even the glue. You shrug again, round up the glue, and sell them to the supplier.
Two years later, turns out the slow horses were slow, the glue was glue, and the supplier was selling them all as thoroughbreds.

Who's more at fault? You for turning a blind eye cause you figured the people with all the money knew better? Or the guy's selling Shyte in tinfoil as silver? ---

So who is at fault? Yes, as a broker we did sell the products that the BANKS had and of course we sold the ones that made the most money at the time. However, the BANKS are the ones that came up with the products (e.g. Option Arm to 95% LTV one loan no MI) as a broker if you weren't smart enough to see that this was set up for disaster it should fall on your shoulders. But the Banks got greedy and wanted more and now with all the trouble we have they are looking for federal bailouts like Bear Stearns.

Countrywide was pushing Options Arms on almost everyone they could, but even there own reps couldn't explain what the program did and they weren't alone. If you asked how the loan worked you got the same basic answer form every Account Executive that was selling them, "You get to choose what payment you want to make Min. payment, Interest Only, 15 or 30 year Fixed Payment." And if the AE couldn't explain it what made them think the broker could. Luckily, some brokerage firms could and like mine were able to see what this loan really did and would only put investors into it on investment property. To investors this worked in their favor, but to the average consumer it left them without a home. So ask yourself again while your wondering at the gas pump paying for $4 a gallon of gas this summer and can't go on that vacations cause its way overpriced now, whose is at fault the Bank or the Broker? My guess the economy is dealing with that as we speak as over 241 banks have closed their doors as of today.

I'm sitting with some realtors that I work with and the questions I get is, what is happening to the market? What do you mean what is happening, I ask them. The market is what it is. In Colorado the market has been on a downward turn for years, our appreciation is almost nonexistence and yet people are stilling buying houses. What is happening is that banks are slowing down, because Wall Street is slowing down. We had a period of the lowest interest rates in history and everyone could have bought a house. People who would have never qualified, where given loans and they moved in with little or no money down. Growing up, my Grandma made it a point to all her kids (and grandkids) that they needed down payments, "Can't buy a house with out a down payment." But lately all you needed was the closing cost and even then you might get away with the seller covering that closing cost for you as well. Times have changed.

Today, banks are getting stingy with their money, no more Stated Income, unless you are self-employed. No more sub-prime loans, you now need at least a 600 credit score. The killer however, the loan that put everyone in such a stupor, Arms and Option Arms, the latter has been slowly slipping away and soon enough no more. I think this is sad. I feel for those people that were put into bad loans, by bad loan officers. I feel for the family that bought a $450,000 on the Option arm, with only 5% down or 10%, not being educated on what exactly they were getting themselves into. I say educated because that is what did not happen. Brokers that were selling this loan only knew they had a high yield spread and this would pay them a lot more then any other loan program, along with the Account Executives pushing the loan, who barely knew the ins and outs, and the consumer is the one who suffered for it. Where did they think the extra money went, $450K with a payment of $1500? They got killed on the negative amortization, and their nice little $1500 payment doubled or went higher then that. To top this off remember there is little to no appreciation in Colorado homes actually lost value, so know there is no chance of refinancing out of the Arm. This in turn leads to foreclosures and way to many houses on the market. This is not a bad thing however, if you are an investor, looking for good deals.

This is a buyers market. This is an investors market. Now is the time to buy investment property, with foreclosures being what they are, and banks starting to crackdown on guidelines. True investors will start to emerge. I have always believed in putting money down (pearls of wisdom implemented by my grandmother) and now banks are going to require the same. No more 100% Carlton Sheets methodology of financing, you need to have money down and like I tell my clients you are going to pay for it one way or the other, either in rate or money down, well the banks are now forcing you to pay upfront. But so what, properties with 20-50% equity sitting there, you can buy, fix up a little bit and hold, in the mean time earning cash flow from rents and when the time is right sell. Making a nice little profit or 1031 exchanging into more property. Once an investor, always an investor. Whatever you do, don't wait to long.