"Bank Profits Soar, Lending Falls As Banks Pay Next To Nothing For Funds "

[FloriTexan]

This headline has me fuming today. I have been to four banks (so far) in the Dallas area to refi my home and get some cash out to do some repairs and none of them will even talk to me because I don't need borrow over $150,000. My home is modestly appraised at $100,000 which is normal for this area for my suburban tract home and means I live within my means. One bank told me it was because of all the regulations now that the State of Texas has put on them, but I have since learned that is just a blatant lie. I mean, WTH!

http://www.huffingtonpost.com/2010/08/31/bank-profits-soar-lending_n_700574.html

:rant:

[Dawson Leery]

1. Never, ever bailout banks.

When a bank fails, let the FDIC give the depositors their money back. Let the vultures....I mean, executives and stockholders take the hit, as they should.

[SlipperySlope]

4. The FDIC is out of money

Seriously; The FDIC has no money left to repay depositors with, it has all been long spent. At this point the Treasury is just borrowing more and more to keep the FDIC afloat.

[Skittles]

2. it's what happens when they are bailed out with no demaind of accountability

[nilram]

3. tried any credit unions?

just curious.

[FloriTexan]

5. Tried a credit union...

They are the ones who told me it was due to the State of Texas regulations. Go figure. I haven't even gotten so far as the credit check with any of these guys. They are all most happy to give me an equity line of credit for a shorter term and higher rate of interest though. They would rather I over extend myself. They are truly Ba$tards!

[nilram]

6. ouch. You might check out bankrate.com

I did a search for a 50K refi in Fort Worth (picked at random since I don't know where you live) and it came up with rates from six lenders. Now, whether they would be willing to follow through is another matter. Good luck.

[madfloridian]

7. Good luck on your quest.

I hear many are having trouble prying banks loose from their money.

[marmar]

8. And they resent being called Banksters......

:eyes:

[FloriTexan]

10. SOA ...

(Skank of America) has my note now and they are the only one interested at this point. I hate that. I really, REALLY hate that.

[Yo_Mama]

9. Texas does have extremely restrictive regs on HE loans

Seriously.
Here's a write-up about it I found on the web. You don't say if you are carrying a mortgage now, but if you are there are rules on how much the total can be, etc.
http://www.expertlaw.com/library/finance/Texas-home-equity.html

It's very hard to borrow a small amount against your home in Texas because of this rule:
Lenders are prohibited from charging fees and costs (other than interest) which exceed 3% of the principal amount of the loan. The law provides significant penalties for a lender who violates this rule and refuses to correct the error once it is brought to the lender's attention.

Basically the bank has to eat the costs of the appraisal, credit check etc. And if they stick it in the interest instead, it's going to wind up being a HOEPA loan. And very few banks really want to get into that business.

Now, if you have a mortgage and you have at least 30% equity in your home, in TX you should refi your primary mortgage and get a cash-out, which you should still be able to do with that much equity.

I'm sorry, but the fact that a credit union won't do it should have alerted you that this wasn't a bank problem.

[FloriTexan]

11. We are trying to refi and get cash out...

I only owe $60 and the whole note only needs to be $80 on a $100 appraised home. That is within Texas regulations. Countrywide was going to do it a few years ago but we walked away because they wouldn't get us below 7% and they wanted $6000 in closing costs which was about $4000 over what they guestimated. I do not want a home equity line of credit as the payments would be too steep for me right now and I refuse to get in over my head because some greedy bank could give a shit. I'm even willing to go to a 15 year note if the rate is right. My credit is "fair" (almost 700) I have over 10 years at my current job and a solid job history. Like I said they are more than willing to give an equity line of credit at 8% for 10 years. We have to replace the entire AC/Heat system asap. We were told we can't run the heater until its fixed or we risk a fire and that the whole thing could go at anytime. Frankly, my husband and I could live with the 100 degree temps and the cold but my ailing 75 year old in law can't. It would appear the bank considers my home not worthy of repair since we're not wealthy enough for them.

[Yo_Mama]

14. FHA

Try FHA for a primary. FHA usually is good about refurnishing loans. With a near 700 score, I would think you could get a loan easily from them. Their current interest rates are really low, although the up-front charge was increased this spring.

If you get a Home Equity Line of Credit, can't you take out just what you need? The payments on HEs are usually a percent of principal plus interest. You need an appraisal plus title, and those fees add up.

With interest rates so low, I know it is hard to get a small loan, but this is ridiculous. The problem appears to be that taking a small loan will put the associated costs so high that your loan would become a HOEPA loan, and very few lenders do those (they are frowned upon by regulators). So really you have to refi the first with a cash-out.

Fannie has some programs that might be helpful also if your income is below the area median, which you can look up here:
https://www.efanniemae.com/sf/refmaterials/hudmedinc/index.jsp?from=hp

Who has your original mortgage?

[FloriTexan]

15. Bank of America...FHA

I finally called them, they are my last resort. The guy I talked to thinks it won't be a problem to do BUT I'm not holding my breath.

[Yo_Mama]

12. I found TX OCCC's brochure

http://www.occc.state.tx.us/pages/brochures/home_equity_lending.html

That's the Office of Consumer Credit Commissioner. In that brochure you will find some other links that may be helpful, plus an official statement of the rules. I don't have any banks in TX so I am not as familiar with the rules as I should be.

Good luck.

[FloriTexan]

13. Thanks - will check it out. nt.