Too little to late for the economy, but we will get a rebate

[pixelthis]

So its christmas time for grownups (and groundbeef)
We are getting a rebate check, 600 for individuals, 1200 for people with a ball and chain.
So if the boss lets you, what are you buying with yours?
Some new cable? A blu player?
Putting it towards a new monitor?
Or blowing it on something stupid like paying bills or savings?
Inquiring pixelateds want to know

[GMichael]

So its christmas time for grownups (and groundbeef)
We are getting a rebate check, 600 for individuals, 1200 for people with a ball and chain.
So if the boss lets you, what are you buying with yours?
Some new cable? A blu player?
Putting it towards a new monitor?
Or blowing it on something stupid like paying bills or savings?
Inquiring pixelateds want to know

We'll see. Right now it would go into the savings to see how our money issues work out over the next couple of months. After the dust clears, we'll see where all the balls land.

[JSE]

We'll see. Right now it would go into the savings to see how our money issues work out over the next couple of months. After the dust clears, we'll see where all the balls land.

Your the government's worst nightmare. You want to save it.

This should be a free pass for anyone who gets the rebate to spend it all! You can tell your wife that it's your duty as US citizens to spend the rebate to help the economy.

[Rich-n-Texas]

I need a new fence.

[JSE]

I need a new fence.

Me to, between Brownsville and the California Coast.

JSE takes cover........

[GMichael]

Your the government's worst nightmare. You want to save it.

This should be a free pass for anyone who gets the rebate to spend it all! You can tell your wife that it's your duty as US citizens to spend the rebate to help the economy.

Right now is just a bad time. I'd gladly spend it if I could. Give me a month. I'll know better then.

[Groundbeef]

Right now is just a bad time. I'd gladly spend it if I could. Give me a month. I'll know better then.

Still paying off the Christmas party bar bill? I thought I sent a check to help defray the cost. Musta been lost in the mail. Huh.

[Rich-n-Texas]

I thought I sent a check to help defray the cost. Musta been lost in the mail. Huh.

How do you think I paid for my new receiver?

[Groundbeef]

How do you think I paid for my new receiver?

You bought a receiver for $15? Did Pix help you pick it out at the Wal-Mart A/V dept? He's real helpful. Did it come with any cables?

[GMichael]

Still paying off the Christmas party bar bill? I thought I sent a check to help defray the cost. Musta been lost in the mail. Huh.

I wish it was just overspending for Christmas. Our mortgage company didn't pay our builders all that they were due. So now we get hit with the balance. $27,000 may be nothing for some, but it's a huge chunk for us.

This rebate will only soften the blow of another closing charge.

[Groundbeef]

I wish it was just overspending for Christmas. Our mortgage company didn't pay our builders all that they were due. So now we get hit with the balance. $27,000 may be nothing for some, but it's a huge chunk for us.

This rebate will only soften the blow of another closing charge.

Time to call the lawyers. Did you build the house? Or have a builder do it? If so, was it the subs that didn't get paid? Have any lein's been placed on the home?

Do you have any lein waivers from the subs, or general?

Sounds like a real mess. What were the extra or unpaid charges for?

And why didn't the mortgage co pay the builders what was due?

[GMichael]

Time to call the lawyers. Did you build the house? Or have a builder do it? If so, was it the subs that didn't get paid? Have any lein's been placed on the home?

Do you have any lein waivers from the subs, or general?

Sounds like a real mess. What were the extra or unpaid charges for?

And why didn't the mortgage co pay the builders what was due?

I did speak with our closing Lawyer. He seems to think that we have to pay.
What happened is this. With a construction loan, there are several "draws." As each part of the house is built, the bank, or in this case, the mortgage company would pay the builder for that part of the building process. (IE: framing, plumbing, electric, etc...) Each time the builder was putting in for his next draw, the bank was paying them, but holding some funds back because they felt that this or that wasn't finished. At the end, all draws were paid, but not in full. The builder didn't notice. (bad builder) The bank was nice enough to knock it off what we owe them (good bank), but didn't tell us about it (bad bank). Now, the builder went over their books and found the shortage. The bank says, "We closed, it's a done deal." The builder says, "I want my money." The lawyer says, "you signed a contract that says that the builder gets paid X amount of money. If he wasn't paid in full, and the bank won't pay him, then you have to pay it." Most banks have been telling us that the market is in decline and we do not qualify for a refinance. We found one Mortgage company who is willing to let us refinance. Not sure of the numbers yet. We should know in a few days what we can lock at and what it will cost us. Till then, no spending!

The builder is a family run company. They are very nice. They did a great job and deserve to be paid.
The first Mortgage company is just now getting us details and paperwork from what happened. They claim to have a signed document from the builder stating that he was paid in full. We may have a loophole, but not sure if we are willing to screw over these nice people. We are thinking of asking them to split the closing costs with us.
No lein's have been placed at this time.

[JSE]

I did speak with our closing Lawyer. He seems to think that we have to pay.
What happened is this. With a construction loan, there are several "draws." As each part of the house is built, the bank, or in this case, the mortgage company would pay the builder for that part of the building process. (IE: framing, plumbing, electric, etc...) Each time the builder was putting in for his next draw, the bank was paying them, but holding some funds back because they felt that this or that wasn't finished. At the end, all draws were paid, but not in full. The builder didn't notice. (bad builder) The bank was nice enough to knock it off what we owe them (good bank), but didn't tell us about it (bad bank). Now, the builder went over their books and found the shortage. The bank says, "We closed, it's a done deal." The builder says, "I want my money." The lawyer says, "you signed a contract that says that the builder gets paid X amount of money. If he wasn't paid in full, and the bank won't pay him, then you have to pay it." Most banks have been telling us that the market is in decline and we do not qualify for a refinance. We found one Mortgage company who is willing to let us refinance. Not sure of the numbers yet. We should know in a few days what we can lock at and what it will cost us. Till then, no spending!

The builder is a family run company. They are very nice. They did a great job and deserve to be paid.
The first Mortgage company is just now getting us details and paperwork from what happened. They claim to have a signed document from the builder stating that he was paid in full. We may have a loophole, but not sure if we are willing to screw over these nice people. We are thinking of asking them to split the closing costs with us.
No lein's have been placed at this time.

Time for a new Attorney!

Couple of questions,

1. Who paid the closing attorney? Was it the Mortage Company or anyone other than
you? If so, you need a new unbiased attorney.

2. Where is the money the Mortgage company was "holding back"? The full amounts
were not paid so the Mortage Company should have records of this and might then be
liable for now paying in full.

It will be interesting to see if the Mortgage Company can produce the "paid in full" document. If they do, you might have the loophole but it still sucks for the builder.

I think your best coarse of action is to pursue the hell out of the lender. It seems it was their screwup that caused this problem. They should refinance you at the same rate for the correct full amount without any further closing costs. That would be the minimum compromise for me. But, I am not in your shoes so it's easy for me to say that.

Too bad Dean Martin does not post much anymore. He was an attorney wasn't he? He probably could not give you specific advised but he might give some general suggestions.

JSE

[Rich-n-Texas]

We may have a loophole, but not sure if we are willing to screw over these nice people.

Being kind and good natured doesn't win you first place GM, not in this greed driven society in which we live. Dog eat dog and all that.

[GMichael]

Time for a new Attorney!

Couple of questions,

1. Who paid the closing attorney? Was it the Mortgage Company or anyone other than
you? If so, you need a new unbiased attorney.

We paid the attorney. When I told him about this paid in full document he said he'd need to see it to be able to tell. We'll see what he says if and when we ever get it. A new attorney is a possibility if we don't like what we hear.

2. Where is the money the Mortgage company was "holding back"? The full amounts
were not paid so the Mortgage Company should have records of this and might then be
liable for now paying in full.

They knocked it off our loan. So in a sense, we got it.

It will be interesting to see if the Mortgage Company can produce the "paid in full" document. If they do, you might have the loophole but it still sucks for the builder.

I think your best coarse of action is to pursue the hell out of the lender. It seems it was their screw-up that caused this problem. They should refinance you at the same rate for the correct full amount without any further closing costs. That would be the minimum compromise for me. But, I am not in your shoes so it's easy for me to say that.

Too bad Dean Martin does not post much anymore. He was an attorney wasn't he? He probably could not give you specific advised but he might give some general suggestions.

JSE

Dean pops in now and then, but not very often.

[Groundbeef]

I did speak with our closing Lawyer. He seems to think that we have to pay.
What happened is this. With a construction loan, there are several "draws." As each part of the house is built, the bank, or in this case, the mortgage company would pay the builder for that part of the building process. (IE: framing, plumbing, electric, etc...) Each time the builder was putting in for his next draw, the bank was paying them, but holding some funds back because they felt that this or that wasn't finished. At the end, all draws were paid, but not in full. The builder didn't notice. (bad builder) The bank was nice enough to knock it off what we owe them (good bank), but didn't tell us about it (bad bank). Now, the builder went over their books and found the shortage. The bank says, "We closed, it's a done deal." The builder says, "I want my money." The lawyer says, "you signed a contract that says that the builder gets paid X amount of money. If he wasn't paid in full, and the bank won't pay him, then you have to pay it." Most banks have been telling us that the market is in decline and we do not qualify for a refinance. We found one Mortgage company who is willing to let us refinance. Not sure of the numbers yet. We should know in a few days what we can lock at and what it will cost us. Till then, no spending!

The builder is a family run company. They are very nice. They did a great job and deserve to be paid.
The first Mortgage company is just now getting us details and paperwork from what happened. They claim to have a signed document from the builder stating that he was paid in full. We may have a loophole, but not sure if we are willing to screw over these nice people. We are thinking of asking them to split the closing costs with us.
No lein's have been placed at this time.

If what you posted is correct to the letter, then YES you will be liable for the money owed. As you stated above, the bank "held back" funds from the contractor. This is typical of residential construction. Sort of an insurance policy so the builder does his "punch list" before closing.

The squirly part is that your builder didn't request the funds from the bank. That is pretty unusual, but if its a small company with lax accounting (ie wife does it on Quicken...but only when she gets around to it) its not impossible.

The good thing is that they were not paid, and demanding additional funds. (That can happen, and it gets very, very messy).

If you were to decide to NOT pay, bad things can happen. The builder could/would file lein waivers on your home. This would prevent you from obtaining a clean title if you ever needed to sell. The could also forclose on the property in some areas, but I'm not an attorney, and not familiar with your local laws.

If your bank does come up with paperwork stating the builder was "Paid In Full", and the builder signed, then the issue becomes a bit more murky.

On a side note, why refi the entire mortgage? Why not go home equity route? Rates are pretty low, and you can get terms up to 15 year. I would look that way. Sure, its a second mortgage, but the interest is tax deductible, and then you don't have to screw with the 1st mortgage.

[GMichael]

Being kind and good natured doesn't win you first place GM, not in this greed driven society in which we live. Dog eat dog and all that.

We are not looking to finish first. It's nice to win, but in the end, we need to be able to live with ourselves. It would eat us up inside every day knowing that we screwed over someone who didn't deserve it. But if they were to give us a hard time about splitting the closing costs... we'll see.

[GMichael]

If what you posted is correct to the letter, then YES you will be liable for the money owed. As you stated above, the bank "held back" funds from the contractor. This is typical of residential construction. Sort of an insurance policy so the builder does his "punch list" before closing.

The squirly part is that your builder didn't request the funds from the bank. That is pretty unusual, but if its a small company with lax accounting (ie wife does it on Quicken...but only when she gets around to it) its not impossible.

The good thing is that they were not paid, and demanding additional funds. (That can happen, and it gets very, very messy).

If you were to decide to NOT pay, bad things can happen. The builder could/would file lein waivers on your home. This would prevent you from obtaining a clean title if you ever needed to sell. The could also forclose on the property in some areas, but I'm not an attorney, and not familiar with your local laws.

If your bank does come up with paperwork stating the builder was "Paid In Full", and the builder signed, then the issue becomes a bit more murky.

On a side note, why refi the entire mortgage? Why not go home equity route? Rates are pretty low, and you can get terms up to 15 year. I would look that way. Sure, its a second mortgage, but the interest is tax deductible, and then you don't have to screw with the 1st mortgage.

We were looking that route, but so far, every bank has told us that there is an 80-85% max. This would not get us enough to pay off the builder. With a total refi we may be able to get below the 6.00% we are paying now. That would help, but then there's the closing costs.

[Groundbeef]

We were looking that route, but so far, every bank has told us that there is an 80-85% max. This would not get us enough to pay off the builder. With a total refi we may be able to get below the 6.00% we are paying now. That would help, but then there's the closing costs.

80-85% max on what? That usually on the 1st mortgage. The primary loan holder wants to have some equity in the mix. The second isn't usually that way.

In all seriousness, try lendingtree.com. We used it for a couple of mortgages, and they worked out great. If you go online now, within a few hours you will get between 2-6 offers for the deal. Most have no closing costs (they are buried in the loan. Don't worry, every bank gets their money!) and pretty good terms.

PM if you want more info offline.

6.00% is pretty good. We locked in a 30yr at 5.25%

Good luck.

[GMichael]

80-85% max on what? That usually on the 1st mortgage. The primary loan holder wants to have some equity in the mix. The second isn't usually that way.

In all seriousness, try lendingtree.com. We used it for a couple of mortgages, and they worked out great. If you go online now, within a few hours you will get between 2-6 offers for the deal. Most have no closing costs (they are buried in the loan. Don't worry, every bank gets their money!) and pretty good terms.

PM if you want more info offline.

6.00% is pretty good. We locked in a 30yr at 5.25%

Good luck.

The places we've spoke to have all said that their policies just changed recently. 95% was no problem last year, but with all the people faulting on their loans lately, they are cracking down. Even the bank my wife works at turned us down. An equity loan was the way we wanted to go to aviod the PMI charge. We do have a mortgage company that wants to work with us. We may be able to get down to 5.25 if we are willing to pay a couple of points. We'll see how the numbers look before we lock.

[Groundbeef]

The places we've spoke to have all said that their policies just changed recently. 95% was no problem last year, but with all the people faulting on their loans lately, they are cracking down. Even the bank my wife works at turned us down. An equity loan was the way we wanted to go to aviod the PMI charge. We do have a mortgage company that wants to work with us. We may be able to get down to 5.25 if we are willing to pay a couple of points. We'll see how the numbers look before we lock.

I see. Makes sense. Don't forget, you can amortize points on your taxes. Its not the best, but at least you get to take some off your taxes.

Also, if you have to pay PMI, keep your eye on it. After you pay down enough, make sure to ask your bank to remove it.

Or, in the off chance that home prices come back, and grow, get a new apprasil in a couple years. If it has appraised up (appreciated) enough to get your loan under 80% you can drop the PMI.

BTW what the hell was this thread on again?

[GMichael]

I see. Makes sense. Don't forget, you can amortize points on your taxes. Its not the best, but at least you get to take some off your taxes.

Also, if you have to pay PMI, keep your eye on it. After you pay down enough, make sure to ask your bank to remove it.

Or, in the off chance that home prices come back, and grow, get a new apprasil in a couple years. If it has appraised up (appreciated) enough to get your loan under 80% you can drop the PMI.

BTW what the hell was this thread on again?

Yeah, we'll keep a close eye. We just closed on this house in November of 2006. All this is still all fresh in our memory. Wish we didn't pay $2500 back then to get our % down. It didn't pay off. Thanks for your help.

It was about the tax bonus and what we will spend it on. I guess mine is going towards a house in a way. What are you doing with yours?

[pixelthis]

Yeah, we'll keep a close eye. We just closed on this house in November of 2006. All this is still all fresh in our memory. Wish we didn't pay $2500 back then to get our % down. It didn't pay off. Thanks for your help.

It was about the tax bonus and what we will spend it on. I guess mine is going towards a house in a way. What are you doing with yours?

Look at the bright side, you DID get a house, something that will be very hard to do in the coming months.
Anyway I'd like to sell the VIZIO AND, WITH THE REBATE, GET A 1080P, OR AT LEAST A SET WITH THREE HDMI.
Sony has always been my brand, don't know if I can afford one though

[GMichael]

Look at the bright side, you DID get a house, something that will be very hard to do in the coming months.
Anyway I'd like to sell the VIZIO AND, WITH THE REBATE, GET A 1080P, OR AT LEAST A SET WITH THREE HDMI.
Sony has always been my brand, don't know if I can afford one though

I like our house too. It's worth the hassle.
Sony can be a little steep. Are there any other brands that you like? Maybe Phillips, Panasonic, LG, or Samsung?
3 HDMI inputs? Let me guess, you don't like sending your video through your AVR? I like the flexability of bypassing the receiver also. I can watch sports or play some games while music plays.

[Woochifer]

Personally, I would've preferred that this rebate money get invested into other areas. With the housing market and new home construction collapsing in a big way, I think the bigger economic benefit would've been to use the money allocated to these rebates towards infrastructure and other major capital improvement projects, many of which have been languishing under state and federal budget cuts. That helps to offset the construction sector job losses and addresses long-term needs. Unfortunately, this idea is way too logical for the politicos in Washington.

The way that a consumer rebate like this stimulates the economy is if people (and businesses) spend it right away. Problem is that consumers are not going to turn around and spend their entire rebate checks right away. And even if 100% of the rebate checks go to consumption spending, the benefits of that spending are not nearly as big as they should be because we now import so much of what we buy at retail.

I hear the examples of helping the economy by buying a "big screen TV" with that rebate check. But, the problem here is that the economic benefit to the American economy with TVs is limited to retailers. The manufacturing and higher value added activity associated with that TV all takes place overseas or in Mexico. At the very least, if people want to ensure that this rebate benefits the American economy, then they should make sure that any big ticket items purchased with that rebate check are actually made here.

Other people interviewed in different articles have indicated that they would use it to pay off debt -- a laudable endeavor, but not something that results in a short-term economic stimulus; or save it -- again, something more Americans should do that does not have any short-term economic stimulus effect.

Make no mistake, if the government wants to give me a $1,200 check with no strings attached (other than saddling more debt onto my daughter and her children), I'll take it. In the end, that money will probably wind up going into my daughter's college fund. But, as a matter of policy, this is just a bone-headed and politically driven action that doesn't help the economy nearly as much as a short-term economic stimulus should.