Why are people homeless? I think I figured it out.
Several years ago I started building me a house and soon ran out of money. I went to the Neon bank and asked Loren Bentley for a $15,000 loan. He asked where I worked and if I had some land. He said he’d okay it with some people and get back to me.
Two or three days later Mr. Bentley called and said that I could have $5,000, and that he would check on my progress and give me the rest. A few weeks later he showed up and saw I was about half finished, and I showed him the big pile of lumber I’d bought with his money. He called me about a month later and said the rest of the money was in my account.
Mr. Bentley advised me at the time to make payments every two weeks instead of each month, and pay as much extra early on the loan as I could, and showed me how much it saved. I moved into the house about a year later and paid off the loan in 4-1/2 years.
People — things have changed. I looked at a loan contract and this is how it goes to buy a house for $138,000, which is about what an average first home costs.
Lawyer settlement fees, $450; title search, $135; title binder, $100; 5 courier fees, $500; title examination fee, $60; closing protection fee, $60; lender’s title insurance, $352; bank loan origination fee, $880; commitment fee, $575; escrow waiver fee, $220; appraisal fee (home), $450; appraisal fee (additional structures), $500; 2 credit checks, $34; tax service to bank, $64; flood certification, $10; appraisal management fee, $75; owner’s title insurance, $168; deed and title recording, $30; transfer tax, $20; city and county tax stamp, $407; pest inspection, $45; pest treatment, $153; pest treatment warranty, $100.
Then there’s the PMI insurance unless you pay 20 percent or more down, and the escrow for insurance and taxes, which will be $400-$500 a month on top of your payment.
My math isn’t that good, but this adds up to about $5,300 of nothing but extortion. Most of these fees are absolutely worthless, nothing but rip-offs.
Add all of this to a $27,000 down payment, and it’s just too much for the average person. I’d rather live in an old school bus back on the strip road.
Where is Loren Bentley when we need him most?