Homebuyers affected by Patriot Act


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mtnbkr
June 4, 2004, 12:19 PM
http://msnbc.msn.com/id/5131685/site/newsweek/

People buying homes are subjected to another fee so title companies can check your name against the “specifically designated nationals” (SDN) list.

Apparently, someone in Treasury thinks terrorists are laundering money through real estate.

I thought the USA PATRIOT ACT was only to be targeted against suspected terrorists...

Oh, the article also lists "private individuals" who are now considered "financial institutions" under the Patriot Act and must perform SDN searches.

I know it's a small fee among many when buying a house, but how is this realistically related to terrorism?

Maybe someone can tell me how taking yet another look at Bill and Jane Homeowner will prevent Arab terrorists from attacking us again...

What next, an SDN search to buy or sell a car? Where does it stop?

:barf:

Chris

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HiWayMan
June 4, 2004, 12:30 PM
Quiet servant. How dare you question Big Brother.


Remember, it's for the children.

Augustwest
June 4, 2004, 12:42 PM
But increasingly, firms like California-based First American Corp. are charging the buyer up to $30 for each person involved in the transaction.

This is a total ripoff. Takes me thirty seconds to check a new client against the OFAC list. Don't like having to do it, at all. It's stupid, really. But it's part of being in the business I'm in.

dischord
June 4, 2004, 02:38 PM
Funny thing:

I just signed refinancing papers last night (5.75% 30-year fixed, woo-hoo!)

There was no Patriot Act form among the scores of papers I signed.

Maybe it's just on new purchases, but not on refinancing.

mtnbkr
June 4, 2004, 02:41 PM
I didn't do anything like this when I refinanced last year either. I'm assuming it's new purchases.

Chris

Smoke
June 4, 2004, 03:13 PM
Sorry to disillusion you folks but that has been going on since the inception of the Patriot Act.

Any financial institution (Bank, S&L, Mortgage Co., Broker) is required to run your name through the OFAC list.

I don't need your permission to do this. You do not have to sign a form. There is no disclosure. It just happens. I have a form (internal) that is kept with you documents that say I did it and found no match. This all happens without you even having to be aware of it.

If I find a "Possible" match, it is reported to the appropriate gov't agency.

It only applys to new customers. Home loan, car loan, or just opening an checking account, doesn't matter.

Enjoy.

Smoke

jfh
June 4, 2004, 03:14 PM
in our real and personal property laws, the only reasons I can imagine that dischord and mtnbkr didn't pay a fee for such a search is because the lenders/agents simply didn't think of it. They must have not read the Title Fee Gazette for that month.

Treylis
June 4, 2004, 11:17 PM
And, despite all this, most of this forum is going to go to the polls and vote for the man who didn't bother to veto what's made all this charming stuff possible.

DJJ
June 5, 2004, 12:28 AM
What do you mean, "didn't bother to veto" it? He insisted on it.

Hawkmoon
June 5, 2004, 02:15 AM
I thought the USA PATRIOT ACT was only to be targeted against suspected terrorists...
Correct.

Anyone other than George W. Bush and Dick Cheney is a terrorist suspect until the gummint decides they aren't ... maybe.

Did you really think the Patriot Act was only to spy on immigrants?

cracked butt
June 5, 2004, 02:23 AM
Just another fee the bank tacks on for 30 seconds worth of work.:rolleyes:


When you apply for a mortgage you go through a large amount of financial analprobing and pay alot of money for it, nothing new.

Smoke
June 5, 2004, 02:46 AM
When you apply for a mortgage you go through a large amount of financial analprobing and pay alot of money for it, nothing new.

No fee for the analprobing here. We do it purely for the sadistic pleasure of it. :D

When dealing with banks or mortgage companies that are selling mortgages on the secondary market, you will expect to pay a bunch of fees. Thats how they make their money.

If you find a bank that keeps all their mortgages in house (like the one I work for) You only pay fees the bank incurrs. Closing costs, flood verification, appraisals, title work, etc. Usually a few hundered dollars.

Smoke

JPL
June 5, 2004, 01:11 PM
Wow.

Maybe I should join the Haganah just to keep them on their toes?

Brad Johnson
June 5, 2004, 03:29 PM
Closing costs, flood verification, appraisals, title work, etc. Usually a few hundered dollars.

Or you can be fortunate enough to live in a (relatively) small town where lenders are very competitive and don't charge an arm and a leg even when they are only originators. Loans here cost an average of $600-800.

What usually bites people in the behind are all the other things that add up. They include, but are certainly not limited to:

Loan setup
Survey
Mortgagee title policy
County filing fees
Flood certificates
Property inspection
Pest inspection
Closing fee (title co)
Appraisal
Courier or overnight delivery charges
Insurance policy (first year plus 3-5 months in escrow)
3-5 months taxes in excrow.
Prorated interest (depending on what time of the month you close)

Depending on the type of mortgage loan you get, these expenses can add up to as much as double your downpayment amount.

If you have good credit (credit scores above 670 or so) you may qualify for some of the new 100% mortgage products. They will let you finance 100% of the purchase price (no down) plus some will allow you to negotiate for the seller to fund some, if not all, of your closing expenses. The downside is that you pay about .25-.375% more interest.

Just remember that mortage companies only care about three things
1) How much do you make
2) What are your debt obligations
3) How good are you at managing your money (credit scores)

They can say all the touchy-feely things they want, but it always boils down to the three points above.

Also, you might have banked with Bank of Whatever for 30 years, but that doesn't make one single bit of difference when you apply for your loan. Their loan department is often a completely seperate corporate division whose only link to the bank is a common corporate parent. The fact that you banked with them is irrelevant, you are still a new customer to the mortgage division.

The bottom line is simple. If you have decent credit, there are ways to get you a house. The worse your credit, the more you will probably have to pay up front. The better your credit, the less you pay. And for those with impeccable credit, you might be able to get in for zero out-of-pocket expense. Your reward for your finiacial prudence. If you have crappy credit and owe everyone money, don't even bother.

And please don't come to the door with a "pre-qualification" letter from some jickylender.com web site. Those letters are crap; they are a worthless waste of time. Loan qualification criteria is (almost) universal. If one lender can get you financed, chances are they all can. Get a local lender who knows the market and who you can talk to face-to-face if there is a problem.

Also, don't get mad at the lender for something YOU did. The lender doesn't care if you have a great sense of moral accomplishment because you volunteer 20 hours a week at the local homeless shelter. They DO care that you had a car repossessed last year because you didn't keep up with your payments. Lenders deal with cold, hard facts. Their sole, solitary concern is the mortgagee's ability to repay the loan. If you have not demonstrated an ability to manage your finances, don't be suprised when they turn you down even though you might make a jillion dollars a year.

And they will still run your name through the OFAC list.

Brad

matis
June 5, 2004, 04:37 PM
JPL said:
________________________________________________

Maybe I should join the Haganah just to keep them on their toes?
_________________________________________________________


JPL,

Irgun, or better yet, Stern Gang would really get them up on their tippy toes. And anyway, I like these even better than Haganah. :D



matis

7.62FullMetalJacket
June 5, 2004, 04:42 PM
What about the NRA?

71Commander
June 5, 2004, 07:27 PM
It only applys to new customers. Home loan, car loan, or just opening an checking account, doesn't matter.






Really!:what:

mtnbkr
June 5, 2004, 09:15 PM
They will let you finance 100% of the purchase price

I was able to find a 110% loan with my credit. Not only did it cover the full purchase price, but even closing costs. I needed something like that because rents jumped a large amount right before I got married and it was cheaper to buy than to rent a 2 bedroom/1.5 or 2 bath apartment (as much as $300-$400 /month). At the rate real estate appreciates around here, I was out of the hole in less than a year.

I paid about .5% extra in interest, but when I financed 1.5 years later, I dropped my rate by 2pts AND got rid of my mortgage insurance.

Chris

Brad Johnson
June 7, 2004, 04:19 PM
I paid about .5% extra in interest, but when I financed 1.5 years later, I dropped my rate by 2pts AND got rid of my mortgage insurance.

Outstanding!

Brad

aguyindallas
June 8, 2004, 05:17 PM
I work in the car business. When we run someones credit, it automatically checks the OFAC database. What a crock of $*!T!

joab
June 9, 2004, 01:03 AM
Here's the form
http://img5.photobucket.com/albums/v14/bugman/posting/Picture_001.jpg

artherd
June 9, 2004, 03:41 AM
What next, an SDN search to buy or sell a car? Where does it stop?

Already going on.

Oh, and just about ANYONE or ANY COMPANY is now a 'financial institution' thanks to Patriot Act 2. (signed into law by Bush on a SATURDAY, the same saturday that CNN was plastered with pics of Saddam's capture. )

While that scum-wad was being checked for lice on national TV, bush ????ed us in the ass.

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