The FAL Files  

Go Back   The FAL Files > Discussion Forums > General Non-Firearms Discussion

Notices

Reply
 
Thread Tools Display Modes
Old October 12, 2017, 19:07   #1
aquaman
Registered
 
aquaman's Avatar
 
FALaholic #: 20926
Join Date: Aug 2006
Location: Washington State
Posts: 237
Bankers Hate Small Business Owners

We're trying to purchase a home before my wife has a child next month. We've been saving and searching the last three years for a special property and finally found one.

With almost 50% down, excellent credit, zero credit card or car debt, multiple rentals that combined produce $2k per month positive cash flow, and steady income for 2+ years... I thought we would be a banker's dream! But we're finding problems.

Why???? The word is, it's because we are employed by our business.

We've been operational for 4 years. The business has zero debt but we have been applying profits towards expansion so we don't have tax issues. We operate in a sector that is consistently in the top 3 business least likely to go bankrupt year after year... Basically... rock solid and happily growing with small cash surplus.

As a farm kid in the 70's, I experienced the vulture bankers sitting at our kitchen table and threatening to take everything while charging 15-22% interest for operating loans (May those bastards burn in hell)... I have no love for bankers, but what has gone wrong here? This is something altogether different.

The deck is stacked against small business owners and entrepreneurs. The American Dream is a steaming load of shit!

If the GOV backed banks will give any swinging dick with a GOVERNMENT JOB a home loan... No money down, no problem!!! What happens to home values? They go ******* crazy! Now I have to play in this over inflated market but they won't give us a loan because we're business owners?

Why did we bail these fat ass retards out? Too big to fail... too stupid to breath says me. Let them burn in the pile of over inflated trash that is the US dollar!!!!

Ok... I'm done whining. Where can I apply for a GOV job?
aquaman is online now   Reply With Quote
Old October 12, 2017, 19:30   #2
Thorack
Acquisition Corp Dude
Bronze Contributor
 
FALaholic #: 748
Join Date: Aug 2000
Location: Aberdeen Proving Grounds, Maryland, USA
Posts: 11,698
Yeah,

That no pay stub screwed my brother in law. He was in the family business getting paid by his dad no pay stub. Dad had to cosign for a house loan.

Thorack
__________________
1. Whenever you are talking to a woman realize this person was born insane and you will never be surprised.

2. Never let Doctors cut on you unless its life or death and ALWAYS get a second opinion.
Thorack is online now   Reply With Quote
Old October 12, 2017, 19:32   #3
55bird
Veteran Member
Silver Contributor
 
55bird's Avatar
 
FALaholic #: 799
Join Date: Aug 2000
Location: St. Petersburg, Fl
Posts: 1,357
I agree, The system is leveling the playing field for the "Guilds". This is why they are gonna make things harder on you and anyone else outside to enter. This is why they hate Trump. Get ready for real discrimination.
__________________
The very things my grade school teachers of the 1960's warned me about communism,my government is today
55bird is online now   Reply With Quote
Old October 12, 2017, 22:45   #4
jollyrogerf14
Veteran Member
Platinum Contributor
 
FALaholic #: 71100
Join Date: May 2013
Location: The Citadel, Montana
Posts: 1,320
Same here. Well over half a mil in non depreciable assets including a completely paid off house, and I couldn't get a loan for $50,000 to buy a rental that rents for over $1000/month. Not a high enough reported income because of growing inventory for my business.

I left the bank in a very sour mood saying something about how if I was an unemployed single mother with a drug addiction, they'd probably cut me a check today. I felt better.
jollyrogerf14 is online now   Reply With Quote
Old October 12, 2017, 22:49   #5
Tuhlmann
Sand In Your Shorts
Contributor
 
Tuhlmann's Avatar
 
FALaholic #: 69411
Join Date: Feb 2013
Location: Here & There, WI
Posts: 1,900
Been through that. Thereís really no good way without a W-2. I tried for 2 years to back in 2010-2012, but buttholes were still tight from the gov-sponsored mortgage system scandal. Get yourself a part-time job making minimum wage and put 10-20k on a credit card, then theyíll be tripping over themselves to provide you with some lending program special just for you!

Whole deal made me realize that debt of any kind is shit. The entire banking system is corrupt and based on fantasy. I made some tough decisions and move some resources around, but the end result doesnít involve a blood sucking bank. You can too, and my free and unsolicited advice to you is to figure out a way to live your life and operate your business 100% debt free. Itís a peace that is hard to explain, but once you are there you will never ever go back.
__________________
Future Crotchety Ol' Bastard

ďIím saying: Think about your contribution to society. Be careful when you get into a business that extracts value. Broaden your idea about whatís enough. And for Godís sake, think about who you are.Ē - J. Bogle
Tuhlmann is online now   Reply With Quote
Old October 12, 2017, 22:57   #6
Bawana jim
Registered
 
FALaholic #: 17482
Join Date: May 2005
Location: west coast
Posts: 15,292
Daughters friends both have good jobs working for the same tech company. They are not married and age 35 with one daughter. Neither has been a full time employee for two years. This week they were approved for a loan to buy a $300,000 house with no money down. In my day you had to have a minimum of 10% down to get a loan and had to be gainfully employed for at least 3 years or you had to pay points.

The world changes. Their house payment with taxes included is $1868 a month. It $300 more than what they pay in rent.
__________________
Studies show smart people use more bad language than stupid mother fuggers.
Bawana jim is online now   Reply With Quote
Old October 13, 2017, 10:40   #7
fnogger
Registered
 
FALaholic #: 51053
Join Date: Dec 2009
Location: places
Posts: 2,324
Bank or local credit union?
__________________
Be conservative in what you do, be liberal in what you accept from others
fnogger is online now   Reply With Quote
Old October 13, 2017, 11:00   #8
aquaman
Registered
 
aquaman's Avatar
 
FALaholic #: 20926
Join Date: Aug 2006
Location: Washington State
Posts: 237
Quote:
Originally Posted by fnogger View Post
Bank or local credit union?
I'm now on my 3rd mortgage broker who seems to be making progress.

I've been banking with wells fargo since the 90's they won't touch it.

Two local credit unions I have relationships with, neither would go past courtesy review.

They all play by the same GOV rule book it seems.
aquaman is online now   Reply With Quote
Old October 13, 2017, 11:21   #9
Bawana jim
Registered
 
FALaholic #: 17482
Join Date: May 2005
Location: west coast
Posts: 15,292
a worthless story

Oops fugged up lol
__________________
Studies show smart people use more bad language than stupid mother fuggers.
Bawana jim is online now   Reply With Quote
Old October 13, 2017, 12:41   #10
cotter
Registered
 
FALaholic #: 23754
Join Date: Dec 2006
Location: Ohio, USA
Posts: 777
You might try https://www.northwestfcs.com/ They were awesome to work with here in Ohio. They deal with farmers all the time who have the same type 'messed up' finances.
cotter is online now   Reply With Quote
Old October 13, 2017, 12:47   #11
tdb59
not really a gun guy
Bronze Contributor
 
tdb59's Avatar
 
FALaholic #: 63177
Join Date: Mar 2011
Location: I am here
Posts: 9,102
That type of loan usually requires manual underwriting.

Banks want plug and play paperwork, and most mortgage brokers are not any better. "Credit Score " means you play the Banker's game by their rules.

There are a few that cater to self-employed / zero credit score applicants.

Churchill Mortgage is one of the best.

https://www.churchillmortgage.com/noscoreloan


................................
__________________
We once were a Nation of Riflemen...


Matthew 5:16
tdb59 is online now   Reply With Quote
Old October 13, 2017, 16:16   #12
rkad
Registered
 
FALaholic #: 12347
Join Date: Nov 2003
Posts: 208
Found out the exact same thing because I farm. My bank wrote a home loan in house after exhausting all other options, but it was a point higher than the gov homeowners loans (Fanny May Freddie Mac), but still a little less than farm debt.
__________________
They are coming through the wire!!!
rkad is online now   Reply With Quote
Old October 14, 2017, 11:20   #13
Blackmore
> Dirt
Bronze Contributor
 
FALaholic #: 2690
Join Date: Feb 2001
Location: West Central New Hampshire
Posts: 5,472
I've found most of these mid level bankers are SO proud of their fancy titles and SO jealous of someone who has the balls to stick their necks out and risk all on their own business - balls said bankers lack. They act as though it's THEIR money - particularly annoying at a mutual bank or CU.
__________________
A professional is someone who can do his best work when he doesn't feel like it.
Blackmore is online now   Reply With Quote
Old October 14, 2017, 19:50   #14
martin35
un viejo gringo
Contributor
Bronze Contributor
 
FALaholic #: 2939
Join Date: Mar 2001
Location: Texas
Posts: 24,788
Not long ago banks gave loans to millions of people who did not qualify at the insistence of a President,,, the economy boomed,,, and then the pendulum swung back the other way when that economic bubble burst.

If the bank you presently do banking with will not make a home loan change or threaten to change banks,,, the loss of a revenue stream is traumatic.
martin35 is online now   Reply With Quote
Old October 15, 2017, 06:38   #15
hueyville
Registered
 
FALaholic #: 74557
Join Date: Aug 2014
Location: Foothills of the Blueridge Mountains
Posts: 4,154
Where they spank me is when ask for past six months to years pay stubs. Don't write myself a paycheck regular. Sometimes go months without check then pull a distribution out. Lenders can't figure out how a man can pay his bills without a paycheck but corporation pays me rent for my building, dispersments and distributions and minimum salary CPA and tax attorney says I can take without IRS bucking. Down side is when roll into social security my earned income will be so low will draw in the lowest scale. Wife was a private medical provider and paid herself same way. Cousin who made same annual income but on weekly paycheck gets $1,000 per month more than wife but she put her money in private investments that she can start drawing in two years which will more than even the playing field.

Be sure to write yourself and wife a pay check as often as can. Mom worked with dad and they pulled all money out in his name. She found out at age 55 was not entitled to Social Security as didn't have enough quarters. Would have to lean on dads. Had to come out of retirement, got real estate license and worked till 62 so had full Social Security benefits. You can hose yourself with more than lenders if not careful. My issue is now everyone wants to loan me money. Paid off house, business, equipment and all vehicles. Bankers don't like not getting monthly checks from ke.
__________________
A time will come when people will not listen to accurate teachings. Instead, they will follow their own desires and surround themselves with teachers who tell them what they want to hear. 2 Timothy 4:3 G.W.T.
"If it is worth doing once...it's worth doing it a few more times to get it right." Stimpsonjcat
hueyville is online now   Reply With Quote
Old October 15, 2017, 14:40   #16
Timber Wolf
Registered
 
FALaholic #: 805
Join Date: Aug 2000
Location: Southern U.S.
Posts: 4,488
Ugh, I work for a a.gov and they still did not treat me much better. My own bank of twenty-eight dadgum continuous years made me jump through all kinds of flaming hoops. Singed my butt each time. Mostly because of a divorce with kid involved. They made me PROVE I was not paying child support. What part of 50/50 custody is so hard to comprehend?

I wanted a house in town in a certain high school district for my daughter. Will also be nice if she stays here for college. If not I might sell or keep it as a rental, whatever it is a good investment. Real solid older home with brick four sides, hardwood floors throughout, 1950s construction that has some modern upgrades and I am doing the rest. If I owned the lot outright I could not build the house for close to what I paid.

So, bought the house for below market, and had 20% to put down plus closing costs in my savings account in their bank. After the closing, and before I made the first payment they had sold the note. Before the second payment that outfit changed their name, and lost my insurance info. Threatened to "buy me homeowners insurance" if I did not do it or prove I had some.

It still bothers me how I was treated over such little money. But, I found out that was part of the issue. They don't make much, so don't give a crap about a sub-100K loan. Imagine, somebody buying a house they can easily afford, the nerve of me for being financially responsible.
__________________
First rule of gun fighting: "have a gun!"

"Guns don't kill people. Daddys with good looking daughters do!"
Timber Wolf is offline   Reply With Quote
Old October 15, 2017, 19:04   #17
moonbat60
Registered
 
FALaholic #: 17000
Join Date: Feb 2005
Location: Midwest
Posts: 4,649
Banks nowadays want to get you on the hook.

If you got and maintain ok or good conditions and keep all your bases covered, they are not interested in you.

Banks are more interested in loaning money to people that are not doing well financially, so those people are at the whim of bankers and .gov, thus dependent on the banks.
moonbat60 is online now   Reply With Quote
Old October 16, 2017, 13:00   #18
C-ya
One day at a time...
Contributor
 
C-ya's Avatar
 
FALaholic #: 16313
Join Date: Dec 2004
Location: Southwest MI
Posts: 1,883
Check Dave Ramsey's website and look for an Endorsed Local Provider (ELP) in your area. He is always going on about how if you have zero credit that you can still buy a house. You just have to prove things differently. Maybe one of the ELPs would be more willing to do the work.
__________________
ΜOΛΩΝ ΛΑΒΕ
US out of the UN!!
UN out of the US!!
C-ya is online now   Reply With Quote
Old October 16, 2017, 15:45   #19
gunplumber
Arrogant Bastard
Gold Contributor
 
gunplumber's Avatar
 
FALaholic #: 96
Join Date: Jul 2000
Location: Surprise, AZ
Posts: 23,459
Churchill mortgage - for home buyers not wishing to be debt-slaves.

I am finally debt-free including the house. I was also affected by the Esperian security breach, so I got a copy of my credit report. There were paid-off obligations on it 10 years old (as well as a 30 year obsolete phone number)!.

I told them to delete them. 7 years is authorized (10 for BR). 7 years and 1 day is not. I don't care if it is favorable, my goal is to have a credit score of ZERO.

__________________
T. Mark Graham, Master Gunsmith
Arizona Response Systems, LLC
gunplumber is offline   Reply With Quote
Old October 16, 2017, 16:34   #20
meltblown
Registered
Bronze Contributor
 
FALaholic #: 34604
Join Date: Feb 2008
Location: SA Tx
Posts: 10,575
GP I listen to Ramsey now and then. I do agree that not having a credit score is a great goal. Ramsey is pretty good but I had a scenario back in August to dump a property that was over 1000 miles away that I had rented since 2004 hoping it would turn around and go positive in equity. Finally bit the bullet and dumped it for 30k less than I owed and had to borrow 20k

Ramsey would have said you're back to baby step 2 and suspend paying the IRA till the debt is paid. I disagree. Borrowed the money from my 401k. I'm paying myself 6% interest. My wife and I max our 401ks. It makes no sense to suspend the tax shelter as our tax rate pushes us into the higher brackets.

Real estate is a highly manipulated market because of the government and the banksters. That's what the OP is dealing with.
__________________
Pain is inevitable, suffering is optional.

Expect the worst, and you'll never be disappointed.

Before trying to beat the odds, make sure you can survive the odds beating you.
meltblown is online now   Reply With Quote
Old October 16, 2017, 17:27   #21
aquaman
Registered
 
aquaman's Avatar
 
FALaholic #: 20926
Join Date: Aug 2006
Location: Washington State
Posts: 237
Thanks for the suggestions and commiseration guys. I REALLY don't understand bankers... So here's the update:

I called Churchill (thanks TDB59 & Gunplumber), they were super helpful but said they'd need 30-60 days to work through the process. Not helpful for this deal, but we'll be working with them if this home falls through.

The 3rd broker (aka: Joker) assured us they had a solid deal last Wednesday, then called Thursday and needed an additional $40k down payment. So we shook the sofa cushions, checked under the car seats and found $40k!

We showed them the money Friday AM and started packing! Pregnant wife was pouring all sorts of sugar on the Aquaman for "taking care of business"

Then the boner killing call came Friday afternoon.... The Joker claimed they miscalculated the property tax and needed an additional $130k down payment. What a silly Joker!!! Except my mostly rational preggo wife wasn't laughing... Aquaman's ever loving sugar shaker was looking like her dog died.

We spent the weekend looking for other homes we might buy for cash. Of course, we found nothing special here in greater Seattle.

So we went to Ikea and looked at bunk beds and other space saving marvels... It actually helped and we were emotionally "OVER IT" by the time we walked out of Church Sunday.

Our real estate agent called the Joker today and tuned him up because she was irate about missing a fat commission. Now the Joker calls with apologies and excuses, says they made a mistake when reviewing our business books and all is cool like Fonzi again.

The Jokers and banks are playing us like fools... We're totally over the house and don't care if we get financing or not. But I feel bad for the seller because I told him we would have no problem with the purchase...

Any predictions on what comes next? Will Aquaman and Sugar Shaker be moving? Will the Joker Joke again? Will the IRS audit us to oblivion? Will our credit score soar or crash? Tune in next week and find out!!!

Last edited by aquaman; October 16, 2017 at 17:42.
aquaman is online now   Reply With Quote
Old October 16, 2017, 17:30   #22
tdb59
not really a gun guy
Bronze Contributor
 
tdb59's Avatar
 
FALaholic #: 63177
Join Date: Mar 2011
Location: I am here
Posts: 9,102
Quote:
Originally Posted by meltblown View Post

Ramsey would have said you're back to baby step 2 and suspend paying the IRA till the debt is paid. I disagree. Borrowed the money from my 401k. I'm paying myself 6% interest. My wife and I max our 401ks. It makes no sense to suspend the tax shelter as our tax rate pushes us into the higher brackets.
That sort of works, unless your job stops suddenly.

Then you have other issues, and you find out who you are really paying.


.....................
__________________
We once were a Nation of Riflemen...


Matthew 5:16
tdb59 is online now   Reply With Quote
Old October 16, 2017, 18:23   #23
gunplumber
Arrogant Bastard
Gold Contributor
 
gunplumber's Avatar
 
FALaholic #: 96
Join Date: Jul 2000
Location: Surprise, AZ
Posts: 23,459
Quote:
Originally Posted by meltblown View Post
GP I listen to Ramsey now and then. I do agree that not having a credit score is a great goal. Ramsey is pretty good but I had a scenario back in August to dump a property that was over 1000 miles away that I had rented since 2004 hoping it would turn around and go positive in equity. Finally bit the bullet and dumped it for 30k less than I owed and had to borrow 20k
There are a few things I disagree with him on. Such as investing in 401k while still owing money on the house. I agree that from a mathematical perspective, the compound interest on early investing will exceed the interest rate on the house.

But to use his own words against him - I see two issues.

1. I would not borrow $100,000 to invest in an IRA. So why would I invest in an IRA when still owing money on the house.

2. With regard to the sequence of paying off smallest to largest, ignoring interest rates. It is a psychological and spiritual and motivational issue. Small successes keep one on track and motivated. The math, overall, is not as important as the momentum.

So I have no IRA, although I plan to fund a Roth to my max contribution at tax time. Even though I believe the market is in a bubble. But I didn't put any money into my own retirement while I still owed on the house.

I did fund my kid's college fund, because that was going to have withdrawals 3 years before my anticipated house pay-off. And I started it when she was born (and now she's burned through half of it with not a whole lot to show).

So for me, the momentum of paying the house off, was more important than the compound interest on a retirement account - assuming both in the 15 year frame. In a 30 year, I think it's just retarded. I saved $100,000 in interest by paying off the house (and shop) in 15 years over 30. Now if I invest that whole house payment for the next 15 years, I'll be far ahead of someone who paid interest on the house, while "earning" interest on the IRA.

Now I do note that for the self-employed, the post-tax benefit of a Roth early on exceeds the same option for a pre-tax 401k, because time is your friend in amortizing the taxes and withdrawing tax-exempt.

Oh, and I do use one credit card - for gas. Because I pay it off each month, and the tank only holds 24 gallons. I'm not going to buy more just because it doesn't hurt as much as cash. And at the end of the year, I have record of dates, gallons and cost for entering into my spread sheet for calculating business use of vehicle deduction.
__________________
T. Mark Graham, Master Gunsmith
Arizona Response Systems, LLC

Last edited by gunplumber; October 16, 2017 at 18:35.
gunplumber is offline   Reply With Quote
Old October 16, 2017, 18:27   #24
gunplumber
Arrogant Bastard
Gold Contributor
 
gunplumber's Avatar
 
FALaholic #: 96
Join Date: Jul 2000
Location: Surprise, AZ
Posts: 23,459
BTW, with a 50% down payment, I'd owner-finance and hope you defaulted! It's just crazy with that kind of down payment, that lenders weren't fighting for the deal.

It's like BofA giving me an 80k HELOC, then when I paid it off, as well as the house, refusing to allow a new one. Less than 50% LTV? Ok, I don't really want the credit, I'm going to work on saving enough to take advantage of opportunity without using credit. But I find it interesting that paying off the LOC promptly, and having no other debt, was reason for not renewing it.

Just like one month I was having serious cash-flow problems and could not pay the mortgage. So I asked - after 10 years of never being late, never missing a payment, can I skip one month? Or interest only? No big deal, right? My last mortgage on my old house, they begged me to do that once a year to squeeze a bit more interest out of the loan. Nope. Nothing. And $1 short there's a huge penalty. I even had more in escrow surplus than the payment. So I sold a few things, made the payment, then transferred the entire remaining balance to my HELOC. Which was a lower rate anyway. It just took more discipline to make regular payments as I only had to do interest for the first 10 years or so. Kindof weird having a second and no first.
__________________
T. Mark Graham, Master Gunsmith
Arizona Response Systems, LLC

Last edited by gunplumber; October 16, 2017 at 18:33.
gunplumber is offline   Reply With Quote
Old October 16, 2017, 19:00   #25
meltblown
Registered
Bronze Contributor
 
FALaholic #: 34604
Join Date: Feb 2008
Location: SA Tx
Posts: 10,575
Quote:
Originally Posted by tdb59 View Post
That sort of works, unless your job stops suddenly.

Then you have other issues, and you find out who you are really paying.


.....................
Not really. I don't pay the 10% penalty for my own load as I'm over the age. It is just income if I'm separated.

48K at 25% tax rate, that's 12000 straight to the gub if we I suspend my deduction to pay the loan. Hell this will be over in a year. Shit you don't even have to think about opportunity costs at 25% unless you're in the mafia

Problem is most of us poor slobs are leveraged by the banks. I don't want it anymore
__________________
Pain is inevitable, suffering is optional.

Expect the worst, and you'll never be disappointed.

Before trying to beat the odds, make sure you can survive the odds beating you.

Last edited by meltblown; October 16, 2017 at 19:09.
meltblown is online now   Reply With Quote
Old October 17, 2017, 15:16   #26
BiGB808
Registered
 
BiGB808's Avatar
 
FALaholic #: 18195
Join Date: Sep 2005
Posts: 1,600
50% down gets you to hard money lender. 5 year balloon with 7-9% interest
__________________
Beans and Bullets
BiGB808 is online now   Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On

Forum Jump


All times are GMT -5. The time now is 00:11.


Powered by vBulletin® Version 3.8.7
Copyright ©2000 - 2017, vBulletin Solutions, Inc.
©1998-2015 The FAL Files