Friday, November 04, 2005

Quarter Million S CA Homeowners Have Bad Credit

One new program in southern California sounds like handing car keys to a drunk person. Titled, 'The World's First Program to Help Homeowners Refinance With FICO Scores Between 350 and 499, and Save Their Homes From Future Foreclosure.' "Laurie Lampkin did some research with Equifax, and the results were astounding. 'There are more than 250,000 homeowners in Southern California who pay their mortgage on time, they have no foreclosures, no bankruptcy, they have 30% equity, or more, and they routinely get denied the opportunity to re-finance. Why? Because they have a low FICO scores. It's a shame, because these are good people, and they are treated poorly by the entire lending industry.'"

"'Because of the equity, and the 'track record' of timely payments, we have been able to create an innovative way to re-finance homes. Once escrow closes, homeowners can consolidate all of their consumer debt, pay off their credit cards, and pay off their car. This gives homeowners financial peace of mind, and rapidly improves their FICO score. Once that happens, we can put them in a Fannie Mae 30 year, fixed rate, low interest loan.'"


At 8:57 PM, Blogger Chip said...

That is awful. I believe no sane non-socialist government should even consider supporting a program that funnels these people (FICO 350-499) into anything other than rental apartments. If they do not clean up their credit, they can stay there forever and continue to be incredibly better off than those who actually are in poverty in Dhaka and Bombay and Khartoum and countless places around the world. Not that any Comrade Politician here will encourage them to be grateful for that.

Credit scores used to mean loan-worthiness. The term seems to have been deconstructed, like so much of our language in the past few decades.


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