Guess what? The loan sharks are ignoring the rules or playing games with the rules. Veterans, active service members and their families are being played.
Many of the same cast of characters, the same con artist loansharking culture that germinated and grew during the Bush-Clinton-Bush-Obama presidencies spanning the S&L Crisis of 1990 to the repeal of Glass-Steagall driving private label MBS violating centuries of tested underwriting standards resulting in the biggest heist in history pulled off against the American economy culminating in a devastating collapse of mortgage markets and a financial blowout, this segment of the financial culture has found military members to push their addictive financial meth on.
And before anyone says it’s the fault of military members, we need to understand the history and conditions that allow this addictive financial opium to be peddled in a military service background.
First, these loans are just as damaging as alcoholism and drug addiction. A young service family that is trying to learn the ropes of growing a family in an environment of low pay for military members, they are doing their best to create a good environment for their children, many who will become military members one day.
These families need financial counseling for sure but such counseling is not a cure. These families are an inch away from food stamps if not already on them. But giving pay raises is not the solution.
Is FHA one of those predatory lenders?
Is Fannie Mae one of those predatory lenders?
I think the worst thing a young enlisted could do is buy a house near a base.
Here’s why:
I have seen deployments become permanent. In the First Gulf War, many units were returned to a different permanent bases elsewhere when the fighting was done.
Base closures still happen. It really sucks to suddenly own a home nobody wants and you have to leave.
My advice?
Rent off base. Be part of the community but not tied to the market there. We did so in Germany and it was the best experience of our lives. Got to really understand the people and language. Rarely had to cook for ourselves; friends always wanted us to come over. Through my many purchases of Weber grills I taught the neighborhood to really grill and BBQ, American style! Oh, and we even had a guy deliver beer and wine to our house, twice a week.
Wait. if you’re planning on a military career, live on base and save money. Someday, you WILL own property, and have a nice nest egg to pay for a lot of it.
I didn’t buy a house until I was an E-8 and getting ready to retire. I bought a farm, actually, and a nice quiet one in the country. Still loving it, 21 years later!
Considering that a lower ranking member will need to go through the VA as they will not qualify for a conventional loan, it is unlikely they didn’t receive a proper loan.
I spent 24 years in the army, about 5 of those years in command. I found that “dumb” cut across just about all ranks. Financial troubles were common with younger enlisted soldiers. Many made incredibly stupid purchases. For officers the dumb moves were almost always related to adultery. Saw many a career ruined because guys couldn’t keep it in their pants. The universal truth of command was that 10% of your soldiers took up 90% of your time due to their poor decisions/behavior.
Most of the base housing nowadays is run by the private sector and you pay rent.
My dad was career Navy, and I remember as a kid my mother would, on occasion, be extremely unhappy when we moved into family quarters on base. Angry, and tearful yelling, especially his last duty station. The house was small (for six kids) and in crappy shape.
But I give my mom credit, even if she was unhappy, she would eventually suck it up and make it a home. Buckets, brushes, bleach, soapy water, paint, and a sewing machine.
And when we moved out, my mother vowed to never leave an incoming family a pigsty. She enlisted all of us in the days before we moved out to scrub the entire place clean as a whistle.
And my dad was an officer. I can only imagine what some of the enlisted housing may have been like...not from the laziness of the former inhabitants, but more from the lack of attention by the Navy to keep the maintenance up on them.
Its not free. If you live off base you get s housing allowance. If you live on base you do not.
Please define what you mean by a “predatory” mortgage broker?
Do you believe the VA should make it harder for veterans to get loans, i.e., require more stringent rules for debt-to-income ratios, higher credit scores to qualify or require more “residual income”, etc.?
Yes, I am a mortgage loan originator at a brokerage and also a Veteran. My business is about 40% VA. I know VA 26-7 like the back of my hand and get nothing but compliments from all of my clients. I take care of them and work on their behalf all the way to closing and afterwards.
From my experience, I would like to see the VA require counseling for first-time Veteran homebuyers. Something like Framework (Home Ready) or CreditSmart (Home Possible). Along this line, many Veterans who have or have had VA loans are not that knowledgeable about the benefits, requirements, and guidelines.
I will also add that there are people in my business who don’t care and also lack the knowledge to take care of Veterans before, during, and after the home buying process. This includes realtors.
I live in Oceanside CA and my wife and I are RE Bokers. We are next to Camp Pendalton and get some spillage form the oval base in CAL, what the marines call “transportation.” We also have thousands of military retirees in north SD.
My wife and I help 1-2 marines aye buy homes. We have an excellent lender and some marines chose the one on base.
IF you are predatory lender in this area you won’t be in business every long. Word spreads fast. 14 years helping military buy homes in SD.