O_o

[textualdeviance]

So, we're working on refinancing the house and some related monetary stuff. In that process is involved credit reports. I did one about a month ago, and didn't see anything outstanding.

Well, the bank mailed us a copy of the full report that they get, and there's this weird little $62 thing on there from some credit agency that handles Seattle Municipal Court.

Que?

So I call up the agency, and they tell me it's an outstanding parking violation. Okay. From 1998. O_o. Okay. From a car we haven't owned since then, from in front of the house we used to live in then.

Oooookay.

I've been getting credit reports regularly (at least once a year) for years, and I've never seen this item before. Apparently it went to collections in April of last year (!) I've never gotten collection notices about it, and don't even remember the original violation. (What kind of violation can you get from parking in front of your own house on an un-metered, un-regulated street?)

Anyway, it's going to get paid up of course, and the agency is sending me over a copy of the ticket, since I have no idea what it's about. And I'm probably going to contact the credit reporter (Experian, apparently. The other two don't report it) to see if I can get the item removed, since I had no idea it even existed.

Our credit has a few old blemishes on it from back when we were scraping by and from some old weird tax stuff of mine (that should go away in a little over a year) but everything else for the last five+ years has been clean clean clean, except one 30 day late payment on a credit card (the envelope with the check fell under my car seat and therefore didn't get mailed) so therefore, this little item, small as it is, annoys me to no end.

On the good side, we're getting a/c installed as I type. So August should actually be livable, for once. Yay.

Comments

[foxykc.livejournal.com]

Call me. Whatever deal your bank is giving you we can beat.

No shit.

[textualdeviance.livejournal.com]

Paperwork's already in, I'm afraid. And it's through our credit union, which are usually a better deal. Nothing I saw anywhere else came close to the 5% they were offering for a 3 yr ARM.

[foxykc.livejournal.com]

I an tell you now that it's a very bad idea. It's the usual refinance trap people fall into. It will cost you a ton of money you don't need to spend. And you're going out another 30 years, which my outfit does NOT do.

We compute interest differently so that payments are lower and the note amortizes sooner. Interest rates are meaningless -- it's HOW the bank comutes the interest and compounds it that is the determining factor. This is how you can take the same money, the same interest rate, and if it is a motor home, pay if off in 10 years, but a house, same money? 30.

Explain that. It's because the bank compute interest just about every nano second, as opposed to once a month.

Trust me. What happens is people go out ANOTHER 30 years, eat into the equity, and never own the home. There are smarter ways to lever on one's equity.

I've taken existing notes and whittled 6 years off of them and about $500-
$1000 off the payments.

ARM's NEVER adjust in your favor. Ever. Only in the bank's favor. When that sucker rachets up -- and it will -- you might seriously consider what my outfit can do to solve the problem.

There is a shitload of stuff the banks do NOT tell their customers. That's what I do -- tell people what the real deal is so they can use that knowledge to their advantage, not the advantage of the financial institution.

Banks and credit unions love refinances. They don't want people out of debt.

My job is to put them out of business.

[textualdeviance.livejournal.com]

I decided on the ARM myself. It's a low rate for the time we'll still be in the house. We'll be moving by the time the first adjustment happens. I wouldn't have done it otherwise.

Oh, and we had a 1-year before, and rates actually went down. They're going back up again, of course, but by the time that happens, it won't matter.

The reason we're refinancing is to consolidate our first mortgage and an equity loan we took out last year, so we have just one payment to make, since we're trying to free up our month-to-month so I can pay for school. Our long-term financial plans are quite different; this is a here-and-now thing, not a we're going to live here for 30 years thing. When we move, we'll be building, and that means a whole different ballgame. We're probably going to move out, rent for 6 months, get this place in selling condition, and then buy the land and do the construction loan. The savings we'll have in interest for the next three years does make that more feasible.

Believe me, I know what I'm doing. No-one talked me into this. It's something I've paid a lot of attention to in the last five years since we first started this process.

[foxykc.livejournal.com]

It's a done deal, but I can see a lot of flaws in the logic.

However, it's your finances.