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Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 04:15 PM   #1
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Special 125% "Freedom Loan": 2 points and 13.653% APR

I don't want to advertise the company, but they are running this ad on tv. Enough people must think this is a good idea that it pays for the advertising.... Yikes! Copied from their website:

2. **tech.com sample Freedom Loan payment assumes 2 points and is based on a 25-year mortgage loan amount of $27,000, an 12.75 interest rate (13.635% APR), and a monthly payment of $299.44 for 300 months. Monthly payment includes principal and interest only. Excludes mortgage taxes and CLTA policies. Full documentation and property insurance required. Taxes and insurance extra. Rate and fee may vary by state. Recent rate, but subject to change without notice. Your loan amount and APR may vary from the hypothetical situation shown. Subject to underwriting approval. Not all applicants will be approved. Loan secured by a lien against your property. Fees, charges and pre-payment penalty may apply. Some restrictions apply. Terms and conditions apply. Consolidating debts may increase the time and/or the total amount of money needed to repay your debt. Call for details.
3. Minimum Freedom Loan amount is $15,000; maximum loan amount is $150,000. Freedom Loan not available in all states and only available on primary residences.
4. "125% of your home's value" refers to the percentage that results from adding the current balance of your first mortgage to the amount of your new Freedom Loan and dividing that total by the lesser of the appraised value or sale price of your home.
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 04:27 PM   #2
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Sounds like "train wreck" financing, backed by "redlining underwriters of America"...........
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 04:31 PM   #3
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Ha! If you sign up for this loan you won't be experiencing much "freedom" for a long time.
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 04:32 PM   #4
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Their target market is probably going to love this product. It appeals particularly to people who obviously carry high interest credit card debt and don't have liquid cash. It's particularly interesting to those people who don't have great credit.

Basically it's just a debt consolidation loan that is secured by the principal residence... which makes it sound like a good idea for those in the target market, and a bad idea for almost everybody else.
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 04:36 PM   #5
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Quote:
Originally Posted by Peaceful_Warrior
Their target market is probably going to love this product. It appeals particularly to people who obviously carry high interest credit card debt and don't have liquid cash. It's particularly interesting to those people who don't have great credit.

Basically it's just a debt consolidation loan that is secured by the principal residence... which makes it sound like a good idea for those in the target market, and a bad idea for almost everybody else.
You'd be surprised at how many folks with GOOD CREDIT will bite on it..............some of those same nice folks that think HELOCS are the BEST way to finance the two new luxury SUV's and the cruiser boat.............
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 04:45 PM   #6
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Probably brought to you by the same guys that came up with "Freedom Fries".

It's patriotic to get a loan from us!
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 04:54 PM   #7
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Makes me want to bang my head on the desk.
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 05:59 PM   #8
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

That is truly frightening. I'm all for leveraging debt... but only when it's lower cost debt to maximize investment opportunities.

Then again, I drive cars to the end of their days so the concept of a luxury SUV (let alone two of them!) is a foreign concept to me.

I'll just stick with buying my 1-2 year old Toyota/Honda/Saturns and enjoy the massive depreciation from driving the car off the lot and then driving it until I have to have it towed for donation/trade-in.

Quote:
Originally Posted by FinanceDude
You'd be surprised at how many folks with GOOD CREDIT will bite on it..............some of those same nice folks that think HELOCS are the BEST way to finance the two new luxury SUV's and the cruiser boat.............
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 06:05 PM   #9
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

These aren't as bad as those "call now and we'll put $10k in your account today!" commercials that are always on tv! Even have a friend of a friend who works for those jerks!

I think those "loans" are at something like 900 percent! i think the same company that the different strokes kid was a spokesperson for - now that's a reason to believe in something huh!

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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 08:00 PM   #10
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Boy, you are a tough crowd! I mean, sure the rates look like usury a bit steep, but the "Freedom" part is the important aspect -- perhaps that is the only way you can swing the rent on these:

"A set of four custom tires and wheels run $1,000 to $3,000.

For about $75 a week -- contracts are renewed weekly or biweekly -- a 19-year-old who wants fancy rims on his car can have them, she said.

If he runs out of money or doesn't like them any more, all he has to do is turn them in, Crenshaw said. "


LINK to article:

http://tinyurl.com/yqpuoq

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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 08:37 PM   #11
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

That rent to own wheel business make me think of the first time I heard of people selling $200 sneakers...THAT will NEVER work, or so I thought.

Speaking of usuary, how about
www.cashcall.com
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-20-2007, 09:11 PM   #12
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Quote:
Originally Posted by jazz4cash
That rent to own wheel business make me think of the first time I heard of people selling $200 sneakers...THAT will NEVER work, or so I thought.

Speaking of usuary, how about
www.cashcall.com
Loan Product Interest Rate Annual Percentage Rate Number of Payments Payment Amount
$2,600 Loan 96% 99.25% 42 $216.55




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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 12:03 AM   #13
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Quote:
monthly payment of $299.44 for 300 months
Wow, I can afford that. Where can I sign up?
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 06:44 AM   #14
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Quote:
Originally Posted by Cut-Throat
Probably brought to you by the same guys that came up with "Freedom Fries".

It's patriotic to get a loan from us!
Sure it's patriotic, the company behind that loan is GM! (Ditech is a division of GMAC which is owned by GM and Cerberus capital)

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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 07:42 AM   #15
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

so your $27K load costs $90K, in today's dollars, but lets assume you
expect inflation to average 14% for the next 25 yrs, hey that may be a
great deal!
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 07:56 AM   #16
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

yeah, "freedom" ... freed from the burden of owning a home in short order. :
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 08:27 AM   #17
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

You would think that given the sub prime mess, which is going to get worse, these predatory lenders would be scaling back a bit. Maybe they are going to try to keep those most a risk afloat for a few more months.
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 08:41 AM   #18
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

i note that the maximum loan is $150k - maybe they are banking on foreclosing on a bunch of places worth more than $150k that they could only loan $150k on?
Maybe they make up for the unfortunate foreclosures by doing LOTS of loans?
Somehow I doubt the lender is in it just because of patriotic fervor.

Could it be new-speak? Freedom Loan = Slave (to the) Loan.

And I thought I was whacking people at 10%... I'm just a piker...
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 10:35 AM   #19
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

Quote:
Originally Posted by tryan
yeah, "freedom" ... freed from the burden of owning a home in short order. :
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR
Old 03-21-2007, 11:24 AM   #20
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Re: Special 125% "Freedom Loan": 2 points and 13.653% APR

The funny thing is, I have a GMAC loan through ditech.com that I'm very pleased with. Their refinance rates were competitive, and when I asked them to reduce the fees they did so by over $1k since I showed them a printout from another company with similar rates and lower fees (by $500).

Quote:
Originally Posted by saluki9
Sure it's patriotic, the company behind that loan is GM! (Ditech is a division of GMAC which is owned by GM and Cerberus capital)

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