When Trying to do the Right Thing Financially Bites You in the Ass

3190816

If you make it to the bottom of today’s post, there is a reward for you! True story.

__________________________

My wife and I are in the process of refinancing our house. When we bought the home a year ago, it was about as painless of a process as buying a home can be. There was some grunt work on our parts, but by and large it was what you would expect; chasing down bank ledgers, getting statements, providing numbers, signing papers, etc.

This year we wanted to refinance. It has only been a year, but the interest rates have dropped enough that it meant freeing up some cash each month that we could then focus on debt in the short term, which was critical given our situation.

What we have found is that the process of refinancing has been FAR more imposing than the original purchase. Not only has it taken months of work to make it happen, but it has also required me to provide what seems to be the same information several times over.

At a certain point in the refinance process, I was also working on getting some debts consolidated at a much lower interest rate (%29.99 > %13.99), but before I did this I asked our loan officer if this would affect anything. I was told it would be fine, since my credit rating was already verified and the interest rate of the refinance was locked.

Smash cut to Thursday morning when I got a call from the same loan officer asking me why there was brand new debt on my profile. I remined her that it was the consolidation loan, and here response was, “Well, Dave, you personally took this debt consolidation loan out, and when you had originally asked me about it, I thought it was to consolidate your own debt. Instead you used it to pay off debt that was in your wife’s name, hence it now shows as new debt on you, and thus we probably can’t secure the loan for you at this time.”

Let’s unpack this for a moment:Read More »