Saturday, September 27, 2008

A Few Words about Washington Mutual

Washington Mutual went under on Thursday, in what was "by far the largest bank failure in American history". This certainly wasn't a big shock, and it's been a long time coming. WaMu was heavily involved in subprime and Alt-A and other dubious lending practices. Here is my story of how I took advantage of this.

When I originally bought my house in Ann Arbor in the summer of 2000, I got a loan through a mortgage broker. It was a "no income verification" loan, which I was able to get with a good credit score and by putting 20% down. I got a 5-year fixed ARM, and the broker assured me he'd help me refinance for free after a couple years. The broker took care of everything, and there wasn't a hitch.

At the end of 2002, rates had gone down significantly, and I called up the broker again to refinance. Of course, his previous offer to help me refinance for free was just a load of bullshit; he wanted to charge a lot and the deal he offered wasn't very good, so I went off on my own to refinance. I first called Wells Fargo (I think) but never actually got through to anybody. I then called Washington Mutual, and they were only too happy to help.

Washington Mutual offered me a great rate, so I was going to save about $350/month for another 5-year fixed ARM. Thankfully, this wasn't a super-gimick loan where I was paying interest-only, but after 5 years it was going to reset to a significantly higher rate. However, I was fairly confident (correctly so!) that wouldn't still be in Ann Arbor in five years, so this wasn't going to be a problem.

Anyway, I fill out all the paperwork, and it all looks good since I have a good credit score, and a significant amount of equity in the house (I wasn't taking any money out). But I still needed to fax them a table listing my sources of income-- they weren't going to verify any of the sources, but they still wanted this on record. I wrote down an honest list, faxed it to the loan officer, and got a call back:

Loan Officer: The income you've listed here isn't sufficient to give you the loan.

Me: Wait, you aren't verifying it, does it matter?

Loan Officer: It matters for our records.

Me: So what can I do? That's my income.

Loan Officer: Do you have any other sources of income? Perhaps there's a Rykoff Family Trust that provides you with income?

Me: What?

Loan Officer: Is there a Rykoff Family Trust that provides an extra $5000/year income?

Me: A Rykoff Family Trust???

Loan Officer: That's right, is there a Rykoff Family Trust?

You could hear her winking over the phone.

I wrote down what she told me to; I got the loan; and sold the house before the rate reset. But they were so eager to give me the loan, and were actively encouraging how to doctor the application. And so it's no surprise that they got swallowed up in this mess.

Wednesday, September 24, 2008

Signs of the times

The Obama campaign is all but ignoring lawn signs in some battleground states -- so they can focus on silly things like voter registration -- and it's starting to backfire in Virginia. From my anecdotal survey of two voters, it's also starting to piss off Ohio supporters, too.

I think the campaign is underestimating how emotionally attached people are to signs, especially in swing states or conservative areas. It's not just about declaring your support: it's about saying "Fuck you"* to your neighbors, because you're freaking tired of hearing the 19 percent-ers impugn your patriotism.

* I am not implying that my mother would actually say "Fuck you" to anyone.

Monday, September 22, 2008

Polling the family

Talking to my parents about the election is always interesting -- Eli and I are in California, surrounded by Obama supporters, so we are perhaps overly optimistic about the election. Meanwhile, my parents are in Ohio, surrounded by conservatives, and, well:
Down here, Friday afternoon is when you wash the sheets. Saturday is when you hang them out. Sunday is when you wear them.

(Quote from a supposed Obama supporter. BUT STILL. I can see why my parents are so fed up and pessimistic.)

Friday, September 19, 2008

Waiting (for 11/4/08) is the hardest part

Yesterday morning, we saw Joe Biden in Canton, which was entertaining (despite starting 1 1/2 hours late). There were two opening speakers: Governor Ted Strickland, which was a pleasant surprise, and then . . . John Boccieri. Who? Well, he's running for Congress in a district where the 30-year incumbent Republican is retiring, and he has a pretty good chance of winning.

Plus, he released this awesome video some time ago:

I wish I could vote for him!

Sunday, September 14, 2008

I don't understand 25% of the country! But not the 25% you might think

I don't particularly care or worry about the 20-25% of the population who still approves of Bush. They're lost causes.

What does concern me, if you believe the polls, is the 25%-ish of the population who disapproves of Bush but is planning on voting for McCain. I am baffled by them! When has there been any indication that McCain will change the direction that this country is going in? Not in 2006, when he voted for the Military Commissions Act, which lets the president authorize pretty much everything. Not in 2007, when he voted for Bush policies 95% of the time. Not in 2008, when he explicitly voted against a ban on waterboarding.

He even hired Bush's speechwriter from 2000 (start at about 4:50):

(In a related note, Jason Jones has been growing on me!)