One Mortgage Solution

The banks always have their trotters in the trough. Right now we are facing a world-wide Depression caused by no-doc mortgages, also called Liar Loans. Mortgage salesmen made zillions placing mortgages where no income documentation was required for people buying spec homes they were not going to occupy. Eventually the greater fool problem cropped up and that packaged debt was seen as worthless, the extra homes unsold, values dropping faster than ever.

I attended a seminar by NACA, which is a non-profit mortgage agency. They get fees for placing mortgages and for saving owners from foreclosure.

NACA confrontational methods make me uncomfortable, but I wonder what else will work. Banks denounce payday loan operations but they charge $29 for insufficient funds on a $1.27 check when the debit is already covered by a deposit (but the deposit conveniently not counted until midnight).

I know a fair number of banking people from teaching them. All the big banks (like Wells Fargo) had no-doc mortgages until recently. The banking people say, "We don't now!" I reply, "That's like giving someone life insurance without asking health questions or verifying any information." Incredible.

This is how NACA works: They require a lot of documentation to save or start a mortgage. They do not have points or most fees, but they have a $50 monthly charge (for a varying amount of time) for placed or saved mortgages. They do credit and budget counseling as a requirement for getting the mortgage or saving it.

More information is available at their website. They may be a solution for some people. They are organizing in major population centers but can be reached by the Internet as well.