what is perfect credit anyway and is that all it takes?

Mortgage and Lending with Bank of England Mortgage 385907

Two articles caught my eye yesterday while checking CNNMoney.com for any bond yield changes. It is a real quick way to monitor any movement.

You have to remember that C(onstantly) N(egative)N(ews) just loves putting the olde negative spin on their stories, whenever possible, but when I saw

"Secrets to getting a mortgage with so-so credit"  by Les Christie


"Mortgage denied despite perfect credit"  by Alison Kosik

I couldn't help myself and I read the articles.

The first point I'd like to make is that in my wildest dreams I cannot, and do not believe that either Les and/or Alison has any credentials, background, or experience that would allow them to pose as someone being able to analyze credit.

But that's not going to stop them

and frankly these articles don't help us much

and let me share my own little secret, they both leave a lot out, I mean they ignore a lot of the facts which, you know, don't support their contentions. But responsible journalism went out the window a long, long time ago.

From Les,

to get a FNMA/FHLMC loan you usually need a 20% downpayment, a minimum score of 620 (good luck with that), and enough income to afford the payments (imagine that). He mentions needing a 28% housing costs ratio.

All I'm going to say about this is if you need to acquire a mortgage don't go to Les or anyone he refers you to.

He goes on to give an example of an applicant, who his source referred to as a "boy scout." He had a couple million in assets, high income, ample home equity, and a "strong" credit score of 700."

In todays world I don't believe 700 is "strong"

His problem is that he sold an investment property with a short sale which caused an "automatic" rejection of his refinance application.

Les leaves out when the short sale occurred, a very important piece of information. But Les either doesn't know that or it occurred yesterday, and wasn't advantageous to his contentions.

We'll never know.

Les goes on to say it's easier to get a loan through FHA. That's true usually.

But what about VA, and what about USDA/Rural Housing?

What about portfolio loans? I know of a portfolio lender who'll bend over backwards for Les' customer.

Now let's not forget Alison

Her, "self employed borrower," (with perfect credit) who has a substantial increase in salary, from 2009 to 2010 is turned down at the last moment. Another little secret here. I hear no mention of what the 2011 income reflects. It might just be important. ahem it is important. We'll never know.

First of all a junior loan officer looking at tax returns with that situation should know that income can/will be a problem, right up front, from day one.

one good year does not stability make

the article is a video and you can see two of the borrowers scores, ones 804, the others 763, which the borrower describes as being in the high 700's. Just for the record 763 is not the high 700's. This situation lacks the 3rd score, and since lenders use middle scores we don't know what the score was that the loan was being based on. we'll never know why Alison thought this was  "perfect credit."

the borrower was turned down, but then was able to acquire a loan through another lender.  

Okay so what's the point(s) here?

The negative news articles being written today just don't help in any way with the big picture; ie, helping the market recover. And the authors (writers) are not qualified to analyze and evaluate credit. What is perfect credit anyway?

Also, obviously that's not all that it takes, and the market does over alternatives to those without perfect credit.





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Christine Koch
eXp Realty - San Antonio, TX
Realtor - eXp Realty San Antonio TX

Jay, you are so right about this negative reporting.  There are many factors involved in qualifying for a loan and a credit score is just one.  Using a couple of examples does not give a good picture of the loan process.

Jul 06, 2011 03:54 AM #1
Jay Beckingham
Bank of England Mortgage - Delray Beach, FL
Seniors ROCK!


i agree. the underlying message i see being sent is they can't get a mortgage, so neither can you. don't bother.

yet in one case the borrower was approved by another lender, and in the other case (the short sale) he could be, so they don't even prove their point. to me, that's irresponsible.



Jul 06, 2011 05:14 AM #2
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Jay Beckingham

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