Letters to the Editor

Re: 'Tighter lending rules could backfire' (June 25)

Dear Editor:

Jack almost hits the "real world" situation right on the head. I can only speak for my actions, but when assisting someone with less than two years' self-employment, bankruptcy, judgments/tax liens/etc., my sole purpose in doing a 2/28 or 3/27 or any "Band-Aid" loan is to allow the borrower time to get away from the bankruptcy/late payment/etc. The full intent is to refi the loan in 2-3 years when their scores are higher, or the time passes from a BK or foreclosure to allow them to obtain a conforming loan. The 2-3 percent jump in their rate is the hammer that keeps them on the straight and narrow path of making their payments on time on all their credit. If they follow the good payment history for the 2-3 years, their interest rate will most assuredly be well below that of the Band-Aid loan that we obtain today.

I think Wall Street will soon realize that they overreacted, and the lending industry will bring FICO requirements and guidelines closer to what they were prior to the media frenzy earlier this year.

Ken Boyle
Senior loan officer
Utah Home Mortgage Lenders

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