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Orange Blooded [2693]
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some clarity on the mortgage credit score fee structure
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May 2, 2023, 12:43 PM
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the click/bait press really lit a fire under people on TNET this week, ya'll just take a deep breath. It will be alright. The poors with low credit scores aren't actually getting a better deal than y'all, so don't worry, lol.
https://www.mortgagenewsdaily.com/markets/mortgage-rates-04212023 Is There Really a New, Unfair Mortgage Tax on Those With High Credit? Seemingly overnight, the internet is awash with news regarding a "new," unfair tax on mortgage borrowers with higher credit scores. Some have gone so far as to suggest that someone could intentionally lower their credit score in order to get a better deal. Before you stop paying your bills in the hope of cashing in, let's separate fact from fiction.  First and most importantly, you will absolutely NOT get a better deal on a mortgage rate if your credit score is lower, even if your nephew just texted you a screenshot of a news headline saying "620 FICO SCORE GETS A 1.75% FEE DISCOUNT" and "740 FICO SCORE PAYS 1% FEE."   So why would your nephew make such a claim? This all has to do with changes to Loan Level Price Adjustments (LLPAs) imposed by Fannie Mae and Freddie Mac (the "agencies"  , the two entities that guaranty a vast majority of new mortgages. LLPAs are based on loan features such as your credit score and the loan-to-value ratio among other things.  They've been changed several times over the years and a fairly substantial change was announced in January of this year. Wait... This news is from JANUARY?!  Why are people talking about it now? Yes, in fact, we already told you about it.  People are confused because they don't understand how "delivery dates" work when it comes to Fannie and Freddie.  Changes that impact fees and guidelines are almost always implemented based on the date the loan in question is "delivered" to Fannie/Freddie.  "Delivery," in this context, typically occurs a matter of weeks AFTER the loan is closed, although it can be more than a month.  
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Associate AD [828]
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Don't let the facts get in the way
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May 2, 2023, 12:49 PM
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of the outrage.
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Orange Blooded [2693]
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It's hard to reason with the outrage mob
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May 2, 2023, 12:57 PM
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I mean, they are just fed bs all day long, so I can somewhat empathize....but ####, take a breath people, lol.
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Orange Blooded [4009]
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Re: Don't let the facts get in the way
May 2, 2023, 2:46 PM
[ in reply to Don't let the facts get in the way ] |
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So let me get this straight….
People with people with bad credit are paying less today than they were last year to borrow money
People with good credit are paying more today than they were last year to borrow money
The government made this change to make borrowing money easier for people who can’t pay their regular bills on time.
That’s what the article says….
You spin it by stating there is a narrative that people are outraged because people with poor credit spend less to borrow than those with good credit in absolute terms.
Then you make the case that the outrage is unjustified because they just don’t understand it’s all relative.
What an kind of ### backwards way of thinking! You guys are a joke 🤣. Thanks for making this country suck
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Orange Blooded [2693]
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It is a misleading framing
May 2, 2023, 6:31 PM
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to suggest that it is a direct subsidy between higher credit borrowers and lower credit borrowers, or some other kind of wealth redistribution.
It’s not. Some updated fees do not represent pure decreases for high-risk borrowers or pure increases for low-risk borrowers. Many borrowers with high credit scores or large down payments will see their fees decrease or remain flat.
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Orange Blooded [4009]
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Re: It is a misleading framing
May 2, 2023, 10:07 PM
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The people with 780 credit scores making 40% down payments. I’ll bet there are loads of those 🤣
Come on - it’s a straight up subsidy/redistribution of wealth and you know it.
Sad thing it’s that it’s on the hard working middle class.
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Orange Blooded [3014]
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Legend [17294]
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Reading comprehension is challenging for many. The articles linked ….
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May 2, 2023, 12:56 PM
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In previous posts actually provided the same explanation.
It’s quite astounding how many articles are linked that actually contradict the point of the post.
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Orange Blooded [2693]
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I mean, what kind of poison is this that ships every other
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May 2, 2023, 12:59 PM
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gd week. The propaganda machine loves a good moral hazard story I guess, even if they have to invent one from the bowels of the finance machine.
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All-In [44050]
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Orange Blooded [2053]
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Re: It's sad that these people are going to help choose
May 2, 2023, 5:36 PM
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As if either side has chosen a decent one lately lol
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Rock Defender [53]
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Re: some clarity on the mortgage credit score fee structure
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May 2, 2023, 1:02 PM
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Orange Blooded [2693]
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mortgage backed securities are what drives the housing
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May 2, 2023, 1:34 PM
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market through these boom bust cycles. Been that way since Lee Ranieri at Solomon Bros invented the product. MBS tranches are like a shot of nitro, they are like a Moloch, a well-concealed Dragul that romances lenders lured by the grand vision of giant MBS trades. the Moloch forces them to keep up with the industry's profit machine and ignore ever evolving risk lurking in their portfolios.
Nothing has fundamentally changed this equation since Michael Lewis wrote the Big Short. Rating agencies still suck since they are still just industry shills, nothing was ever really fixed by Dodd-Frank when it comes to this game. Now it's too big to fail, and the only thing really in the way of another MBS calamity rippling through the industry are so-called stress tests, but everything gets watered down by industry lobbyists, so it still seems as shaky as before.
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110%er [5680]
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Re: some clarity on masks
May 2, 2023, 1:16 PM
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they do not do what people told you they would do
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Orange Blooded [4785]
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Re: some clarity on the mortgage credit score fee structure
May 2, 2023, 1:36 PM
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Plenty of people who aren't poor have bad credit. Also this does significantly narrow the gap between what people with good and bad credit pay for a mortgage compared to before.
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All-In [26513]
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110%er [8984]
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just tax the drug cartels
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May 2, 2023, 1:40 PM
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bada bing
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Legend [17294]
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Legalize and tax recreational cannabis and gambling
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May 2, 2023, 1:56 PM
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Designate drug cartels as terrorists and introduce them to drones.
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All-TigerNet [13127]
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Cool, an 8th graders take as your source.
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May 2, 2023, 1:40 PM
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Anyway, I don’t recall anyone saying low credit scores get a better deal. What I do recall, is that high credit individuals will pay higher interest in general to cover the losses of “forced” lending to those with low scores.
Just all part of that wealth redistribution that you are in favor of; as long as it’s someone else’s money.
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All-In [34594]
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Libbies cant comprehend that***
May 2, 2023, 2:02 PM
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Heisman Winner [137970]
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You might want to go back and read those threads again then.
May 2, 2023, 4:22 PM
[ in reply to Cool, an 8th graders take as your source. ] |
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8th grade comprehension is pretty spot on for the list of posters screaming about communism. Why do you have "forced" in quotes? Are banks being "forced" to lend to certain "types" of people?
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All-In [40934]
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It's really rather simple
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May 2, 2023, 1:42 PM
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everybody shares in the total risk. If you have better credit it will cost you more while still being less than the more risky borrowers. They used to have to pay more due to their higher risk. They still do, it's just "less" more.
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All-In [34594]
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yep, exactly.***
May 2, 2023, 2:03 PM
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Orange Blooded [2693]
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They still pay significantly more than those w/good credit
May 2, 2023, 5:34 PM
[ in reply to It's really rather simple ] |
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yet for some reason people are convinced by the headlines that they are somehow getting a better deal than those with good credit.
It’s how the arguments been made anyhow.
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110%er [9666]
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I ain't seen no TNet morons who thought the Poors were
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May 2, 2023, 2:40 PM
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getting a better deal than us rich folks.
The Poors are just paying a bit less than before and the rich folks are paying a bit more to make up for it. (That last part is what has everyone up in arms...)
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Orange Blooded [2693]
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