NO protection for the consumer.

[Administrator]

I am looking for a lender to do an FHA loan. I am self employed so we are doing everything under my wife's name. We meet all of the FHA guidelines and even though the upfront expenses are a lot more, the rate and payment (along with the guidelines) are very appealing. We are in a 'unique' situation that no lenders will even acknowledge or even pretend to care about. We bought our home from the home builder that my wife works for. We received an 8% discount on the purchase price. In addition, since the discount was not part of the loan transaction, the purchase required 5% down. With simple logic and a 3rd grade math skill, you can see that we had 13% equity on the day we moved into our home. We live in Phoenix, and it is, admittedly, a horribly declining market. We were told by every lender before we purchased our home that it would be a lot easier to get a better rate etc. (because of our 'unique' situation) after the home closed. I did a lot of research and found multiple lenders that would refinance anywhere from 30 days after close to 'as soon as the ink dries'. Armed with this information we proceeded with our purchase. However, as everyone knows, in October everything began getting even worse than most people could imagine at the time. We were having more and more trouble trying to refi. None the less we were told by a company to get our credit up over 680 and wait until the loan had 'seasoned' 6 months. So we did. However, we are now having a great deal of trouble getting a loan. I have been very careful with allowing people to run our credit - even just flat out telling lenders, I will get you what you need. I have copies of our credit reports from the big three. My wife's credit dropped 50 points in two months with only two people checking her credit. We have not had a late on ANYTHING since 2003 and we just paid off our old $186k mortgage and our $35k LOC - I would have thought that her credit would have gone up 50 points not down 50. Anyway - my question is - I have hired Veracity credit to try to get our credit reports to be accurate - and I have not had luck. I also have been told that our credit score is not supposed to be effected by multiple inquiries within a period of time as they understand that you are 'shopping' for a loan. This seems to be inaccurate BIG TIME. If I don't let a lender pull her credit they can't send it to underwriting - if I let them her score gets hit in the double digits. Every lender right now has one reason or another they can't do the loan - some want 12mo seasoning - (would have been nice if they told me that before running the credit) others send out appraisers who are $50k below what other appraisers where at. Is there NO ONE protecting the consumer right now? My wife’s score has gone from 697 (middle score) to 666 in one month from two inquiries. We hit a patch of bad luck 40 months ago and we had to file bankruptcy. Some of the creditors are still reporting late payments and derogatory on our credit reports and we have 'disputed' them only to receive letters saying that they are 'verified'. Are there any decent lenders left? Can we sue past creditors for reporting incorrectly? Does the government know that they are killing the economy by restricting guidelines on loans? People are being forced to sell their homes because they can't afford the adjusted rate. This is putting more homes on the market - since the guidelines have become so strict no one can even buy anymore no one can buy. We are in a vicious circle and the only way to stop it is by funding loans so homes can be purchased. This will cause the supply to decrease, the demand to increase, the values to go back up and the economy to correct itself. Bailing out a lender who lost 3% of their profits last year (oh my bleeding heart) does not help the average American. We pay $2,800.00/mo to our lender and we knock our principle down $422.00 - do you think for a second anyone believes these lenders are really 'losing money'? Most of the people defaulting have paid there actual loan amount off three times by now. Who is still writing loans right now? Scratch that – who is still pushing loans through and getting them funded right now? Signed: Phrustrated in Phoenix

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(Source: mortgagefit.com)