Paper shuffling's a real puzzler
September 15, 2010
I was going to pose this question to real estate expert Alex Lengemann in his Q & A column that appears weekly on the opposite page.
Alex has helped me out with free advice a couple of times and he's been right on with it. He referred me to a local individual who helped me with a refinance a few years ago. I was very happy. Mostly I was happy to be ridding myself of Citibank, the company that ended up with my mortgage, which had been shifted seemingly dozens of times back in the day.
Now that I look back on it—and with what I've learned about the banking industry and Wall Street—it makes a lot of sense. Back then, I didn't know what was going on, though I thought all of the paper shifting strange.
So I end up with Citibank. And I didn't like Citibank. I didn't choose Citibank. Trying to deal with them on any issue—including correcting a mistake THEY made—was the most frustrating experience of my life.
In 1991 when we sought the mortgage, our real estate person (a relative) suggested that we approach the bank that currently held the mortgage. It was a bank in Romeo. I want to say the name was something like 'D & N Bank,' though I truly don't recall.
Anyhow, our relative real estate guy was right on. Face-to-face meetings at the Romeo bank resulted in our approval, though my husband and I were scared out of our wits at the time. I laugh now when I think about it—that a 1,200 square foot house and five acres of wooded land cost less than $100,000—a steal compared to bigger homes on super small lots in the city, but an amount that scared the *&$# out of us. We had just sold a pretty cool 1925 home in Berkley for a figure south of $70,000, a huge pile of dough considering its late 1970s asking price was something like $25,000.
Anyhow, for two non-dollar obsessed types, almost seventy-grand was a fortune, so nearing the hundred-thousand-dollar mark was simply unfathomable. Obviously, we didn't borrow the entire selling price. We put a pretty good chunk of the surprising Berkley house earnings down and considered ourselves lucky—if not a little frightened—that we could embark on our mission to embrace "life in the country."
That's how things worked back then. You bought an affordable house, took care of it, maybe even fixed it up, sold it and made a few bucks so you could repeat the process. Imagine that! A house gaining in value! But I digress.
Anyhow, after several notices from several mortgage companies in the late 1990s, Citibank ends up with our note. The refinance guy Alex referred me to dealt with another bank and I was thrilled. For two whole months, that is. Once again Wall Street was at work. I didn't know then that the "sub-prime" situation was occurring—though I do recall being scared that I wouldn't qualify for the refinance mortgage and was absolutely shocked that I did without a hitch. Now I know what I know.
Back to the two months of non-Citibank bliss. It was short lived. Soon enough I get a notice that Citibank is now my mortgage holder. I am once again feeding the beast unwittingly.
So my question for Alex is how can I stop this? Then I realize that this is more of a financial question than a real estate question so I don't email him with it.
I do wonder, though, if anyone has any answers to this. I would really like to be the one to determine which bank I write my monthly interest—uhm—mortgage checks to. Why do I have to deal with a corporation that I loathe whose philosophy I loathe even more? Do I have any say in this whatsoever?
My logical brain tells me probably not. After all, why would some bank be rushing to grab my debt? Unless they really just want to take my house...
...I keep hoping that one day this will all make sense to me; that there is a logical explanation for banks driving people out of their homes; that they're somehow better off with a big glut of vacant real estate instead of steady cash repayments from people who've lived there for years. Their policy to more or less not work with their customers is a bit confounding.
Mostly, I'd just like to feel like I have some sort of control of my future; that the decision to "buy" the beautiful place in the woods was not stupid; and that I don't have to support a system I do not believe in.
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Catherine Minolli is Managing Editor of the Tri-City Times. She began as a freelance writer with the Times in 1994. She enjoys the country life, including raising ducks and chickens.