First of all, I'm furious.

Actually, I'm more than that. I'm, well, in the words of Snoopy, I'm *&^$$(.

And a whole lot more.  And this post is so that I can vent.  I'm going to vent for a few sentences and then I'm going to walk away and then I'm going to vent some more and then walk away.....

Deep breath.  In with the good, out with the bad.  And my mother always said all that therapy was just money down the drain.  In fairness to my therapists, they probably thought so too.

Deep breath.  Okay, here we go....

Ohio, in it's infinite legislative wisdom several months back decided that they hate people.  I know this because for the last two months to the day, I have been on a daily basis trying to place one loan.  Not sixty, one. 

Why so long?

Because you're to stupid to know when to quit?    Yeah, I'll take a little of that.

Because you suck at this job?    Yeah, I'll have some of that too.

Because Ohio hates people?    Oh yeah, add a bunch of that!

Senate Bill 185 was designed to right all the wrongs that us evil-doer, money hungry, godless heathens (aka Mortgage Brokers) have brought upon mankind.  The invention of the ARM, (that was our creation), 125% financing (yep, I was in on that one myself), and the best one of all - mortgage fraud care of the No Doc loan (sigh, yep those were the good ol' days, I remember them well).

So Ohio decided that they would cure their home financing ills with a well placed, intelligent design-like, brush stroke that was the proverbial mile wide.  A bill so well conceived, so well intentioned - how could we not have thought of this before?  The public will truly love us for this and our re-election is assured.  Grin. Grin. Grin.

Oh, and in the county that my buyer's would be home is in, just raised their taxes 42%.  Now, I don't know my geography all that well, but unless there is an ocean next to Ohio that I don't know about or "there's oil in them thar hills", a 42% increase in taxes is well, stupid.  Yep, stupid covers it nicely.

So, the earliest results of SB 185?  At last count, 16 lenders no longer do 100% financing in Ohio.  That isn't to say that a full doc, 700 score, with 10% down, family of four buying their second home in four years can't get a loan.  But if you work for tips, your done.

Here's a list of people that can't buy a home is Ohio.  As you read this, think of how many people this could total up to.  Not just in Ohio, but your state, too:

Barbers, hairstylists, pizza delivery guys, bartenders, waiters, waitresses, cab drivers, dancers, valets, landscapers, paper guys, sky caps, one man shop painters, carpenters, handymen, electricians - all of these people cannot get a stated loan in Ohio.

Recently, Illinois tried a program similar to what seems to have caught the Ohio legislature in a such giddy, bill-writing mood.  Their's had an equally cryptic name; HB 4050 or "Chicago creates 'Social Profiling'".  Now this program was only in 10 zip codes.  I have a good friend of mine who was affected by this program to a small degree, so I know a little something about it.  And how did there's turn out?  Well it was recently suspended after it was discovered by the same geniuses that enacted the law that surprise! - in those 10 zip codes sales of homes dropped 50%!  And that was just the first half of 2006.  In comparable areas, they dropped 20%.  Lenders bailed on the state and some are (I love this part) actually being sued by people that couldn't get a loan from a lender that the state determined shouldn't loan to these people in the first place. 

Read that last sentence again - you're right it doesn't make sense.  But this is my latest example of why people should vote.

My client had 5% down.  The seller agreed to a Seller Hold Second.  We were on the MLS.  They buyer has a credit score above 680.  Two years employment, two years rent.  I have a VOE and a VOR.  I have lease agreements with some of their friends that were going to move in with my buyer.   But, my buyer is stated - because they make most of their money in cash.  They have cash reserves and I can VOD them virtually anytime.  Two year trade line with a credit limit of over 10k.  DTI is virtually negligible.

But Ohio hates people.

Some may say or even respond that if you can't go Full Doc you shouldn't have a home.  If you can't document every penny, why should anyone loan to you.  And this is a valid and complex argument that could go either way at any moment.  But for my two cents, I leave you with this;  Re-read that list of employment and just guess how many people that is.  Now add to that number the fact that Bank of America has decided to create a credit card offering for people that are in our country illegally.  They don't pay taxes, they work for cash, and they have built an enormous portion of our county - they are also breaking the law, yet we want them to have a credit card "So they can start to build their credit and buy a part of the American dream".

Except in Ohio.

p.s.  There are two sides to every story.  And I am sure that eventually, now that numerous lenders have removed their 'Stated' programs from Ohio or don't lend there at all, this bill will be amended or even repealed.  Which wouldn't be that good of an idea because some of the bill was great for our industry (the cap on points comes to mind).  But the road to hell is paved with good-intentions.

Enjoy,