This And That

 

Somewhat overextended I am right now.

The van is still in Atwater; the really very nice people at the repair shop say they have repaired "the big noise," but there's still a "little noise" that they can't diagnose -- may be transmission, may be differential, but they aren't sure. They said they drove it to another shop, had them look at it there, got the information that it is either/or, then drove it back to the first shop and it was driving fine. "Just this little noise..." OK, say I.

Problemo.

I wouldn't be surprised if it is both transmission and differential. Which means it may be time to retire the van -- which, by the way, has been a loyal friend on the road for a long time.

Getting back to Atwater without a vehicle of my own is something of a challenge -- not impossible, but a challenge nonetheless (there's a train to Merced and it's about 8 miles from the Amtrak station to Atwater.) But if, as I suspect, I really can't drive the van back to whence it came, just getting down there is kind of useless. So...Pondering options. I'm kind of inclined to go check out a similar van available out in the suburbs but getting there without a vehicle of my own, I'm finding, takes longer than taking the train to Merced would. Isn't that something? Public transportation: Good luck, sucker!

Meanwhile, at the same time, I'm trying to work through refinancing our mortgage in New Mexico... and what fun that is, given that it is all long distance via phone and email. I'm working with a couple of lenders: Wells Fargo, which holds our current mortgage, and another I'll not name at this point, but which we may be going with. Terms proposed are similar, and though with the new lender the process is more complicated, it will take much less time to complete the refinancing with them than with WF. As the broker says about why it takes so long with WF: "It's Wells Fargo." And when I think about the months it took to get the mortgage financing package from them in the first place (We put a deposit on the house in August of 2005; we did not close on the mortgage until January of 2006) it's not all that surprising that a refinance would take almost as long and conceivably longer. Oh, and the WF horror stories I've read. Heartbreaking. They're almost all the same: promises made; promises broken; paperwork lost, over and over and over and over and over and over and over again; last minute document demands from the bank; last minute denial in processes that stretch out for months and months and months. In some cases, it's a matter of sales taking priority over service (it's a bank, you know), and in others, it's clearly a matter of deliberate cruelty, because WF never intends to provide mortgage refinancing or modification at all. They seem to just want to hold the customer tight and take various fees along the way -- for appraisals primarily, which in some cases are never actually done.

From what I can tell from the testimonies (I've seen hundreds by now), people get lured in by WF sales pitches ("Low Rates! Refinance Now! Mortgage Modifications! We have Programs!") and are sold something they actually can't qualify for. Once they are sold, the loan agent forgets about them, never submits the documents -- which is why they get "lost" over and over again -- until the last minute, knowing that the rubes are going to be declined or get screwed. It seems to be such common practice at the Big Banks that the personnel don't even think about it any more. It's just business as usual for them. Completely vile.

On the other hand, I have found only one complaint about the alternate lender we're working with -- and that complaint was through the BBB which does not disclose details. One complaint. We'll research court cases to make sure that this record is accurate. The broker we're working with is a little harried, but she follows up, seems to be very forthcoming and up front, and is essentially a neighbor in NM (next town over.) Costs are a little higher with that lender than what WF is proposing, but you know what? I tend not to believe much of anything WF says these days...

Meanwhile, the rest of the household at Casa Ché is preparing to retire at the end of the month and we are packing up for the Final Move to New Mexico (prep for which I was headed to NM to take care of when the van broke down).

It's quite a basket of challenges and activity for an old coot and sometime radical like me.

I'm busy and sometimes kind of frantic. But the situation has helped me realize (again) how fundamentally lucky I am to have these challenges to work through as best I can. To learn from. Perhaps to help others from what I've learned. You never know.

Often I find myself in a quandary and dilemma between the vanilla middle-classness of much of my lifestyle and the call to rebellion, challenge and adventure that has characterized so much of my life. I'm face to face with that quandary right now, being pulled in several directions at once, and all sorts of things seeming to be popping out of some alternate universe to claim my attention and say "Hay! What about this! And that! And the other thing!"

One of the class of challenges that we'll be facing once the whole Ché household is retired is that we will be without health insurance for a while -- a few months in the case of one of us, a little over a year in the case of myself. We are not going to use the COBRA option, which is close to $3,000 a month to maintain our current coverage, and there is no paid health care plan included in the retirement package. There are options to purchase, but none are less than $1,100 a month. Even with Medicare, the supplements offered through the retirement system are breathtakingly expensive. So when people start bellyaching about all the benefits public sector retirees get, they need to check some facts rather than succumb to the propaganda of the media. Most pensions are based on years of service and contributions by employer and employee; there has never been a free ride for most public employees; they have always been contributing to their pensions. Furthermore, they have voluntarily -- in recent years involuntarily -- taken significant pay cuts and/or foregone scheduled increases, thanks to generous Union Bosses who always seem to see their own nests feathered very nicely indeed. Yes, indeed. (Their argument: "It could be worse, yanno.")

Many public employees never work long enough to reach the point where they qualify for a pension at all, or they work in categories that aren't covered. This has become more commonplace as budgets are cut and most new hires are temps -- some of which remain temps for years and years. And years. They might not even qualify for healthcare coverage or have to pay huge premiums once they do qualify. And this out of salaries that are being constantly reduced. I have been a public employee or contractor from time to time over my working career. My longest stretch as a public employee was 11 years. I decided to take my retirement in a lump sum when I left. I received -- let me look it up, they sent me a 1099-R -- $632.73. From which they withheld $126.55 in taxes. To assert -- as the propagandists constantly do -- that public employees are all somehow privileged over private sector employees is to be deliberately deceptive or obtuse. And the idea that it is somehow "just" to cut anyone's salary or benefits in this economy is akin to economic suicide.

Yes, there are a few people who are doing very well in the public sector, oh my yes. And they will retire with 6 figure incomes, in some cases higher than their base pay was, and they'll get full health care coverage on top of it and probably all kinds of other perks as well. Whether or not they deserve it is beside the point. They negotiated whatever it is they receive in salary and perks and benefits, and whatever it is, it is much less than that of those at the top of the private sector pyramid. In the areas I'm most familiar with, salaries top out at a little over $100,000; most workers think they are doing well if they get $35,000. Many earn much less. Starting salaries are pitiful, not much higher than minimum wage. If they work long enough to get a pension at all, it will amount to no more than 60% or so of their final wage, and in some categories, they won't get Social Security. We're not talking Big Bucks except at the very top of the public sector pyramid, and even those bucks aren't that big when compared to the retirement packages of CEOs.

On the other hand, just the fact that public employees still have any kind of defined benefit retirement packages at all is enough to set off the claxons of the propaganda machine every few minutes. I know this since I am in a capital city, and the local (McClatchy) paper has had a never-ending propaganda campaign against public employees, their unions and especially their pensions. It's relentless and every day. It's been going on for years, through good times and bad; and why not? They broke their own unions and decimated their pension funds years ago. Why not go after the public sector, too? While they like to yammer ad infinitum over the Big Ticket public pension "scandals" what they are really going after -- it's obvious -- is the pittance the lowly long-time employee might get after 30 years. They cannot stand the notion that a lowly state or local government worker who has been drudging all these years -- often berated and thanklessly -- might get 50% or 60% of their salary when they retire.

Since private sector workers get nothing -- even if they put money by in their worthless 401ks or looted IRAs -- why should public employees get anything?

This is completely backwards thinking.

And that kind of thinking has characterized the whole economic policy discussion since well before the crash. It only intensified afterwards.

EVERYONE should receive a decent retirement income; it shouldn't even be a controversial topic. EVERYONE should receive healthcare coverage automatically -- yes, of course they would pay for it through taxes. That shouldn't be controversial, either.

The correct way to address the banking and financial crisis was to provide household debt relief from the first, so that creditors could be paid off from the bottom up. Instead all the relief went directly to the banks; oops, nothing left for the people!

It's all so screwed up thanks to the perverse ideologies of the few that have been sold to the many like cotton candy.

But I ramble and I'm late for an appointment...
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UPDATE: Had a long chat with the Wells Fargo loan agent soon after posting this; she was almost abject about Wells Fargo's horrendous reputation for bad customer service. Of course she said Bank of America is worse! Yes, well, that's not exactly an endorsement is it?

The "problem" she said is in Modifications, not Refinance (I disputed this), and she said that she would NEVER ask us for documents we had already submitted if something went missing during underwriting, because she would have copies of everything, and if there was a need for something we had already submitted, she would produce and provide it from her files.

She said it would not take more than 90 days if we act now (there is another program on the horizon, she said, for FHA loans, and that's going to cause another backlog in the Refinance Department... ) It would probably be much less than 90 days, and she'd try to get it done much quicker by "pushing" the Underwriters and Processors. I asked her where they were. She said she thinks they're in Arizona but she's not sure.

In addition, she pointed out that having Wells Fargo do the refinancing is much simpler than doing it through another lender because they already have the mortgage file and don't have to create a new one. She almost claimed that another lender couldn't do it at all. I said, "Yes, it is so simple, it literally takes only a few minutes to complete the required forms." She disputed that, saying that they have to get an appraisal (actually, it may not be necessary, but they want one anyway) and they have to do the usual due diligence to confirm sources of income and such, so it takes longer than "a few minutes" to complete the underwriting. But yes, she agreed, it is "simple" for the originating bank. The only reason it takes so long to close a refinance is that there are so many of them to be done. Another lender essentially has to start from the ground up, and may wind up unable to do the refinance in the end.

She was she said determined to demonstrate to us that Wells Fargo's refinancing customer service was among the best in the business, and promised to stay on top of our loan through the entire process. I pointed out that we got the same promises when we originally financed through Wells Fargo and it took 5 months to close and the interest rate was 2% higher than we had been told it would be. When we questioned the loan officer about it, she claimed it was the going rate for that kind of loan (purchase and renovation), regardless of what we had been told when we first applied for the mortgage. So I wasn't really going to take anything that Wells Fargo had to say at face value.

LATER: I got a call from the other lender's broker. And we talked for a long time. During the day, we'd been emailing about retirement and other issues, and finally she sent an email saying that she couldn't "start" the process until after the last day of the month because of the retirement income issue. Whoa. This actually would amount to a one month delay in "starting" the process. I was stunned and said so.

She said even if she "started" now -- by submitting full documentation to the extent we have it -- everything would stop as soon as the underwriters made contact with the employer because there would be confirmation not of employment for the next six months but of retirement at the end of the June. In order to get past that roadblock, we would need to submit an Award Letter, which we can't get until at least the end of June, so there really wasn't any point in submitting the other documents now since underwriting can't proceed without confirmation of retirement income and it will still take the same length of time to get the loan underwritten once the Award Letter is submitted as it would if we started now. She says once we have all required documentation in place (the only thing missing is the Award Letter so far as we know) then the process will take just about 24 days to closing. She said that if something required for underwriting is missing, the process stops, and the application has to go through Underwriting again.

Rather than take that risk, she said it would be better to gather all the required docs and submit them all at once.

During the day, I'd been researching the HARP refinance guidelines and Freddie Mac "Seller's Guide," and sure enough, it is more difficult for another lender to do the refinancing because they have to create a whole new mortgage file and have to follow much stricter underwriting rules to get it approved for purchase -- in this case by Freddie Mac. With Wells Fargo, they and we have already met most of the underwriting requirements and don't have to go through the whole process again (for example, we're assumed to be creditworthy, and as the house already has an appraisal from the first mortgage it isn't absolutely necessary to get one again -- though Wells Fargo wants one anyway.)  But in the case of either Wells Fargo or a new lender, they must verify source of income. In other words, the process cannot go forward for either lender without an Award Letter. So that's going to be the sticking point no matter what.

 Also, we did some more extensive court searches for complaints against our alternative lender, and there were literally none. Zero. Nada. This contrasts with HUNDREDS of complaints against Wells Fargo. They're practically every day.

It's all fascinating...