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Author: CCinOC Big gold star, 5000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 127262  
Subject: CFPB issues homeowner counseling rule Date: 1/15/2013 1:02 PM
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Dwdonhoff and I have said before: all first time homebuyers need (not should get) homeownership-related counseling before they buy. The Consumer Finance Protection Bureau has issued this ruling. I think it's a good law. Now there are no more excuses.

http://www.consumerfinance.gov/regulations/high-cost-mortgag...
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Author: Dwdonhoff Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124554 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/15/2013 2:06 PM
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Dwdonhoff and I have said before: all first time homebuyers need (not should get) homeownership-related counseling before they buy.

I'm actually more militant than that. I don't care about ownership... Let anyone who either has cash, or wants to borrow (perhaps privately or otherwise) without a regulatory catchnet do so on their own risk.

I say anyone who wants to borrow collateralized funds (greater than some de minimus amount... say $25,000) *AND* retain the rights of residential lending law protections ought to be required to take certain financial education course, pass a fairly stringent test, and maintain periodic financial continuing education and test grades in order to remain in current status and avoid foreclosure.

Our recent bubble melt down was caused, at its core, far more by consumer ignorance than any level of corporate greed (which can only exist in a field of consumer ignorance.)

Dave Donhoff
Leverage Planner

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Author: inparadise Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124556 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/15/2013 2:57 PM
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I say anyone who wants to borrow collateralized funds (greater than some de minimus amount... say $25,000) *AND* retain the rights of residential lending law protections ought to be required to take certain financial education course, pass a fairly stringent test, and maintain periodic financial continuing education and test grades in order to remain in current status and avoid foreclosure.

Our recent bubble melt down was caused, at its core, far more by consumer ignorance than any level of corporate greed (which can only exist in a field of consumer ignorance.)


Or, we could just remind people that which should be obvious...don't sign anything you don't understand, and bring it to someone who can explain it to you if you don't.

Thanks, but I'm not looking to make Nanny Sam stronger in that regard. The need to be responsible for your actions should be a given.

IP

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Author: Dwdonhoff Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124557 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/15/2013 3:02 PM
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Hi IP,

Thanks, but I'm not looking to make Nanny Sam stronger in that regard. The need to be responsible for your actions should be a given.

Oh, you *KNOW* I am 1,000% in agreement against permitting the nanny monster any further out of her cage...

I propose *WITHHOLDING* regulatory protections and recourse, *UNLESS* a borrower show proof of *INDUSTRY-PROVIDED* education & testing, to established government standards (where the only part the government plays is in promulgating the established standards... all fulfillment is done at the efficient market level.)

</diatribe>
Dave

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Author: inparadise Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124559 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/15/2013 5:06 PM
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I propose *WITHHOLDING* regulatory protections and recourse, *UNLESS* a borrower show proof of *INDUSTRY-PROVIDED* education & testing, to established government standards...

Fabulous. So now the never ending standardized testing that plagues our schools can be extended into adulthood. Trust me, you will understand what I am talking about when your child gets to school. They should lengthen the school year at least a month to compensate for the lost time from standardized tests.

IP

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124560 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/15/2013 5:28 PM
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Dwdonhoff:

<<<Thanks, but I'm not looking to make Nanny Sam stronger in that regard. The need to be responsible for your actions should be a given.>>>

"Oh, you *KNOW* I am 1,000% in agreement against permitting the nanny monster any further out of her cage..."

In the abstract, apparently.

"I propose *WITHHOLDING* regulatory protections and recourse, *UNLESS* a borrower show proof of *INDUSTRY-PROVIDED* FN1 education & testing, to established government standards (where the only part the government plays is in promulgating the established standards... all fulfillment is done at the "efficient market level. FN2)

FN1 - Building a moat and possibily anti-competitive

FN2 - Delivery the paper, check the box, take the class with the entity that makes it easiest to pass?

Would it not be simpler to limit the products that benefit from the residential lending law protections fully amortizing loans with fixed or varaiable rates (and no teasers on variable rate, it starts at index plus margin). Perahps require 20% down, no purchase money seconds or home equity lending for x years?

Want a teaser rate, interest only payments, negative amortization or balloon payment loan, ot any of the other exotic features, then forego the the residential lending law protections and take your chances. No need for a bunch of classes and tests. No need for the government to promulagate a bunch of new standards. No new paper to delivery to check the box.

Just my $0.02.

Regards, JAFO


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Author: Dwdonhoff Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124562 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/15/2013 7:13 PM
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Hi JAFO,

*INDUSTRY-PROVIDED* FN1 education & testing
FN1 - Building a moat and possibily anti-competitive


Almost all professions (financial, legal, insurance, accounting, medical, dental,) have continuing education and test passing standards that are provided by private industry. How does that eliminate any industry competition?

WHY do we demand professionals prove ongoing competence?

What justification is there (especially if we are to believe that one person's loan default has grander effects on his surrounding society) to let high end borrowers off the hook for competence... and/or to provide them with the benefits of equitable recourse when they willingly put their community at risk without such competence?


Would it not be simpler to limit the products that benefit from the residential lending law protections fully amortizing loans with fixed or varaiable rates (and no teasers on variable rate, it starts at index plus margin). Perahps require 20% down, no purchase money seconds or home equity lending for x years?

Want a teaser rate, interest only payments, negative amortization or balloon payment loan, ot any of the other exotic features, then forego the the residential lending law protections and take your chances.


Yes, I'd support this as well. In fact, I would support this wholeheartedly!

Dave

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124565 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/16/2013 1:31 AM
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Dwdonhoff:

"Hi JAFO' Howdy.

<<<*INDUSTRY-PROVIDED* FN1 education & testing
FN1 - Building a moat and possibily anti-competitive>>>

"Almost all professions (financial, legal, insurance, accounting, medical, dental,) have continuing education and test passing standards that are provided by private industry. How does that eliminate any industry competition?"

It appears that youare changin the argument. You were previously writing about testing the borrowers (not teh industry members). I am not awre of any US state that requires consumers of financial, legal, insurance, accouting, medical or dental services to pass a test and provide evidecne etherof in order to obtain the services.

"WHY do we demand professionals prove ongoing competence?"

Because someone is paying for their advice; and that is still different than testing the consumers.

<<<Would it not be simpler to limit the products that benefit from the residential lending law protections fully amortizing loans with fixed or varaiable rates (and no teasers on variable rate, it starts at index plus margin). Perahps require 20% down, no purchase money seconds or home equity lending for x years?

Want a teaser rate, interest only payments, negative amortization or balloon payment loan, ot any of the other exotic features, then forego the the residential lending law protections and take your chances.>>>

"Yes, I'd support this as well. In fact, I would support this wholeheartedly!"

Much simpler to implement and enforce and does nto create a whole new cottage industry.

Regards, JAFO

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Author: kahunacfa Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124566 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/16/2013 2:43 AM
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Whenever I visit a foreclosed property that is occupied, and where the telephone call to the listed property provides no, or conflicting information, I approach the property with with a uniformed Sheriff's officer along with me. The officer rings the door bell, I NEVER do.

Kahuna, CFA

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Author: Dwdonhoff Big gold star, 5000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 124567 of 127262
Subject: Re: CFPB issues homeowner counseling rule Date: 1/16/2013 8:30 AM
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Hi JAFO,

It appears that youare changin the argument.
Nope.

You were previously writing about testing the borrowers (not teh industry members). I am not awre of any US state that requires consumers of financial, legal, insurance, accouting, medical or dental services to pass a test and provide evidecne etherof in order to obtain the services.
Road Vehicle drivers.
Airplane pilots.
... others.

Much simpler to implement and enforce and does nto create a whole new cottage industry.
Yes, and yes... and if I am going to support a concept virtually guaranteed to never occur, I may as well get behind yours! ;~)

Cheers,
Dave

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