Select Portfolio Servicing - Fairbanks ripoff unjustfied intrest rate increase despite lower rates in housing market Jacksonville Florida

This is some of what the Better Business Bureau of Utah says about Fairbanks AKA Select Portfolio Financing and about 10 other names they use or have used says ny has unsatisfactory record with the Bureau "Based on the BBB files this company has a UNSATIFACTORY record with the bureau due to unanswered and UNRESOLVED complaints.

Some complaints have been resolved. This company has a pattern of complaints concerning problems with consumer payments posting to accounts correctly and other accounting delays and errors. In addition,complaints allege the company is forcing homes into foreclosure when it is not warrented.

The bureau processed 234 complaints about this company in the last 36 months, our standard reporting period. of the total of 234 complaints closed in 36 months 27 were closed in the last year." Please go to the site www.utah.bbb.org to get the full story about this company. The FTC site also contains alot of documentation about this company and fines ,settlements comments etc including a $400 million judgement againt them and identify them as preditory lenders.

With my case I should ad that when we financed our house 2 years ago it was with another co that had checked out as a reputable lender. However for reasons unknown our contract was taken over after 6 MO. by SBS. We have been fortunate not to have problems to this date with the exception of the unjustified intrest rate increase that goes into effect at the end of our 2 year fixed rate.

The company pretty much admitted that my rate is going to 10.5 from 7.5 purly because my contract says it can and that we can expect a 1 point increase every 6 MO. regardless of the market or our improved credit rating and increased assets in regards to funds availability.

As I have stated there is no justification for my increase based on the records they have at hand regarding my finances. Reputable companys do not make these kinds of increases unless they are warrented by past performance of the consumer and the current market rate at the time of the review. Further info and tips about how to avoid mortgage scams can be found. A CNN site points out some things to be on the look out for when financing. It indicates older consumers and first time buyers as the prime targets of motgage scam's. Lenders that try to get you to finance for the max value. They usually deal with appraisers that will give inflated values of property and encourage you to finance to the limit.

Never try to get more than you need. Keep your loan to a limit well below the appraised value of your property or you will find yourself with a inflated loan that you can't sell out of. You might find it safer to keep the loan on your house as far under the value rather than trying to get every dollar you can to decrease debt. make paying your mortgage the first priorty. Credit debt. can be taken care of by other means rather than having every penny tied to the mortgage on your home.

View brokers that want to get every penny you owe tied into your mortgage with suspicion. In my case I am relieving some debt with my refinance but not all My mortgage loan will be well below the resale value of my home. The safest route to getting a fair and accurate appraisal is to solicit your own appraiser rather than one recomended by the lender. Remember, like wolves they hunt in packs. Preditory lenders use appraisers that will give a inflated appraisal to get the most out of you.

You might find it far better after refinancing to be late or behind on credit card or other debts and suffer some finance charges now and then rather than what you figure paying off those cards will cost you over a 30 year inflated loan.

If you do get into real trouble with these other debts you can at least sell the home and come out with some cash in your hands to resolve credit issues. If you finance to the max on a inflated appraisal you will not be able to sell your property for what you owe and loose the house anyway + still owe the balance on that loan and still have the other debts to contend with. These people want your property and the brokers that work with companys like Select/Faibanks line their pockets with the profit from a inflated loan.

Do not deal with unsolicited offers for refinance. The large majority of these scams come thru the mail promising debt relief and only deliver debt grief. Talk to friends relitives etc. for a reputable broker and always check out the internet BBB etc to find out if the lender has a track record. Subprime lending is a incredably slippery slope and Preditory lending is a Hot scam.

Mortgage fraud according to the FBI is one of the fastest growing white collar crimes with repors quadrupling since 2,001. Don Henley (of the Eagles) put it best in one of his songs " a man with a briefcase will steal more than a man with a gun."

Also remember what age you are living in. In our world today "there are no facts and there are no truths only data to be manipulated" also from Don Henley. Take your time and don't be pushed into something that sounds to good do your homework. With the internet and other tools available in this age it does not take that much time to check out who you are dealing with. Good luck and hey be carfull out there Right Steve?

Ronald,

Steve is correct in saying that SPS/Fairbanks is not a lender; however, the brief history he included in his post was redacted in many ways by SPS/Fairbanks. Steve is talking about how things should work with a reputable servicer. If my 401K dollars were invested in mortgage backed securities serviced by SPS/Fairbanks, I'd start buying lottery tickets as an alternative retirement plan. All jokes aside, these folks at SPS/Fairbanks are given a license to steal in their pooling and servicing agreements. Google a few terms (tranches, securitization, MBS, secondary mortgage market, pooling & servicing agreements, Thomas Basmajian, BASEL II, mortgage servicing fraud, PMI Group, CSFB, Fairbanks Capital, servicer ratings agencies, Moody's, Fitch, Standard & Poors, etc) to further educate yourself about how vulnerable the consumer is to mortgage servicing fraud.

Some at the FTC would like to move on to other bad servicers and say the SPS/Fairbanks work is done. This couldn't be farther from the truth. The firm is under a microscope by the securitization industry and they continue to engage in some of the practices that were barred by the FTC class action settlement. I know from first hand experience.

It is for this reason that you should be particularly careful if and when you try to refinance from these people. Pay close attention to your account statements and start requesting payoff quotes on a bi-weekly schedule (they may charge for each payoff quote, but it is worth it if you want to have a paper trail in addition to statements). You should also get an annual escrow statement of some sort. Review it carefully. Lastly, make certain that theyrecord your loan satisfaction document if you do refinance. Also, request your original note from them once they have been paid off in a refinance.

Good Luck,

so you work for select and you moniter this site to put out fires. If you would stop rationalizing and read what i am saying YOU would get the point.

By law and the contract they CAN raise to 10.5 at this review. All i am saying is that in my case the increase is excessive and unjustified. The market says that and other mortgage lenders apparently agree by virtue of the facts in MY case and My record.

They raise to the max with out regard to the current market or specifics of the individual account. my contact says can, not will increase. it is supposed to be a reflection of the current market and the market is down. You act as if they have no choice As for 401k investments if the market is down then i loose if the market is up i win i have no problem with that.

However i would not feel comfortable or continue to invest with a company that will gouge its customers just to make the share holders happy. Apperantly you agree with the concept of win at all cost. So there are plenty of other more serious allegations at this site about Select AKA Fairbanks and the fines Penelties and judgement against them that speak for themselves.

Apparantly our legal system does not approve of their past buisness practice either. so let his be the final word. my other comments and your rebuttals have covered it all so the people reading these can make up their own minds about doing buisness with Select. I strongly advise agaist it. By the way get your glasses checked its ronald not robert and go get your mortgage thu Select you approve of their buisness ethics so much sounds like you should. Thanks for your comments

Robert, I posted the 2 rebuttels to your original post. Maybe this time I can make it MORE clear.

SPS or any other mortgage servicing company DOES NOT HAVE THE RIGHT OR ABILITY to change the terms of your original mortgage contract. ALL they do is SERVICE mortgages that are in institutional portfolios. They do not EVEN OWN the contracts. They service several $100,000,000's worth of mortgage portfolios.

Let me give you an example that is easy to understand.

Let's say you have a 401K plan with your employer.

In this 401K plan you have mutual funds.

One or more of these mutual funds may be funds that invest in debt, like a Bond fund.

These types of funds own many different short term, intermediate term and long term debt as the primary investment.

It is common for this type of funds to own mortgage debt. >>>>Like your mortgage!

SO>>>>Here is the important question.

If you invest money in your 401K plan, and if one of the funds was performing badly because it was renegotiating its portfolios by giving rate reductions to the mortgages it was servicing, WOULD YOU BE HAPPY THAT YOUR FUND WAS LOSING MONEY? THE MONEY YOU INVESTED?

Copied straight from SPS site:

What types of services does SPS offer?

SPS is an experienced residential mortgage loan servicer with a portfolio that includes Alt-A, sub-prime and non-performing assets. SPS provides Interim and permanent servicing solutions to a wide customer base.

What is the history of SPS?

SPS was founded in 1989 to invest in underperforming and problem loans acquired from the RTC and FDIC. SPS serviced, resolved and liquidated such assets to maximize returns. After developing significant expertise in this area, in 1994 SPS began managing and servicing sub-prime and non-performing mortgage loan portfolios for third parties. SPS also began servicing third-party Alt-A mortgage loan portfolios in 2002. SPS changed its name from Fairbanks Capital Corp. to Select Portfolio Servicing, Inc on June 30, 2004 and on October 4, 2005, Credit Suisse (USA), Inc., acquired all of the outstanding stock from the prior shareholders.

So, you get it Robert? SPS is not ripping you off because they refuse to lower your rate or change the terms. THEY DO NOT HAVE THE RIGHT TO DO THIS! THEY DO NOT OWN YOUR LOAN!

thanks for the comments and you are right it has nothing to do with morality. That is the problem or did i not make it clear? as for the comment of 6.5 I never said i was getting or trying to get a rate of 6.5 I simply stated that was a current rate which i said was prime rate in error

Not having the first rebutel to read i believe that gentleman said that mortgage rates were at 6.5 and that that was correct but as i say check the first rebuttel and see what that broker said the current rate was for fixed aprs. The whole point is that the market is down at this time .

I will give a brief example of good buisness. I called my credit card company the other day and had a question on the pay off for the purpose of paying off the balance to help with my refinance after my question was answered i was asked if there was any thing else they could do for me. I laughed and joked that you could lower my intrest rate (which was 11.9) she replied let me put you with someone on that. a gentleman came on and asked what he could do and i told him i had joked to the lady i was talking to about lowereing my rate. he said just a minute , put me on hold, came back on in less than a minute and said that effective the next day my new rate would be 10.9. That is what i call good buisness.

by comparison The card co. capital one my wife has a card thru will not even consider lowering her rate of 14.9 even though we have paid the balance off from a $5,000.00 limit in less than two years. they did offer to raise her credit limit $300.00. neither card is maxed out and we as i have said never been late in our payments on anything and pay more than our minimum payments which we have done with the mortgage co. on several occasions. as to credit issues yes we have some in the past, a bankruptcy 7 1/2 years ago. but credit reports don't show good history of pay offs only current payments on open accounts but they do keep any bad issues on the report.

they don't show history like the $20,000.00 pay off for a high rate car loan we got a year after filing bankruptcy. we paid on that loan never late and paid it off 1 year ahead of time. my only reason for posting here was for the benifit of passing along information about the way select does buisness. I have 2 mortgage brokers working on my new financing and both at this point have several options for fixed rates that are around 8.0 We have not even had the house appraised yet because we did major updating to the amount of $25,000.00 only using the credit cards for less than $5,000.00 of that amount. The rest we paid out of our money market account.

we are putting the finishing touches on the work as I did alot of it myself, and when I have it complete enough for a accurate appraisal (hopefully next week) we will get a appraisal of the property and continue with the refinance process. So even with this preliminary we are falling well below the max rate select CAN charge me when it turns to an ARM. And by the way those lower quotes we are getting are inspite of the fact that my wife's job was eliminated after 16 years of service so we are getting these better rates based purly on my income alone. Both brokers have stated that if she can find a job before we close we can get a even better rate. Both brokers and my sister in law who has her own mortgage buisness in reno nev. have stated that the rate increase is excessive for the current conditions i have stated here and all have said that this is common practice for companys like select, to get as much as they can out of their customers pockets regardless of the current rate or situation.

In conclusion the only thing i am saying here is my case aside, that Select does bad buisness and should be avoided. they have a proven track record of deciept and bad buisness practice evidenced by the large settlements against them in the past for their practices resulting in name changes to get away from their bad reutation as a mortgage lender. I am one of the fortunate ones that have the means to get out of my contract with them What about the poor soul that has struggled to keep up his part of the agreement and kept his payments on time but can't get out from under them for one reason or another. Does he deservive to have a increase to the max allowable just because the legal papers say they can regardless of the current rates? and eventually over time if he cannot get refinancing they will raise the rate to the max allowable on the contract regardless of rates or payment history.

Preditory creatures lie in wait for oppertunity and when the time is right they pounce on the prey with out mercy for the kill. That is the definition of a preditor and that is what Select AKA Fairbanks and other names do to their customers. I have my own buisness and i could in many cases have charged more than my estimates at the completion of the job but generally don't unless the customer has added undiscussed work to the job and i always inform them of what the increase will be. I don't take advatage of the situation and sock it to them just because by law i could.I work with them with their intrest in mind espesially if they have been good customers.

That sir is called doing good buisness and that is why I don't have to advetise to get work. So draw your own conclusion about Select and chose your own moral code to live by. It is because of buisness done in the manner Select does that it is getting so hard for common people in this country to better their lives. Corporate greed is destroying the quality of life for us all as they have no boundrys or concern for the people who have trusted them to treat fellow human beings with compasion and respect. That is the only point i am making about Select and by the way I am not whinning thank you very much.

It is not legal mumbo jumbo Robert. And the lender is not taking advantage of some "loophole" as you describe.

This is a very common type of loan structure. Millions of them are in use all across America.

When you bought your home, for whatever reason known only to you, there were some issues that prevented you from getting conventional financing. This loan was made available to you so that you could buy your house, otherwise you would not have qualified.

This loan was never supposed to be a home loan for a long length of time. It's sole purpose is to provide inexpensive, short term financing. Now, you are doing exactly what you are supposed to do with this loan... refinance out of it into something better.

This has nothing to do with morality, what is right or wrong, whining or feeling screwed. You did not get screwed. You are doing exactly right, getting into a better, more appropriate loan.

In your original post you were referencing a 6.5% loan. Why are you not qualifying for that loan? The interest rate of 7.9% you wrote in the last post is nowhere close to what you should get with decent credit. Based on that, it looks like you are still having some credit issues.

It is not legal mumbo jumbo Robert. And the lender is not taking advantage of some "loophole" as you describe.

This is a very common type of loan structure. Millions of them are in use all across America.

When you bought your home, for whatever reason known only to you, there were some issues that prevented you from getting conventional financing. This loan was made available to you so that you could buy your house, otherwise you would not have qualified.

This loan was never supposed to be a home loan for a long length of time. It's sole purpose is to provide inexpensive, short term financing. Now, you are doing exactly what you are supposed to do with this loan... refinance out of it into something better.

This has nothing to do with morality, what is right or wrong, whining or feeling screwed. You did not get screwed. You are doing exactly right, getting into a better, more appropriate loan.

In your original post you were referencing a 6.5% loan. Why are you not qualifying for that loan? The interest rate of 7.9% you wrote in the last post is nowhere close to what you should get with decent credit. Based on that, it looks like you are still having some credit issues.

It is not legal mumbo jumbo Robert. And the lender is not taking advantage of some "loophole" as you describe.

This is a very common type of loan structure. Millions of them are in use all across America.

When you bought your home, for whatever reason known only to you, there were some issues that prevented you from getting conventional financing. This loan was made available to you so that you could buy your house, otherwise you would not have qualified.

This loan was never supposed to be a home loan for a long length of time. It's sole purpose is to provide inexpensive, short term financing. Now, you are doing exactly what you are supposed to do with this loan... refinance out of it into something better.

This has nothing to do with morality, what is right or wrong, whining or feeling screwed. You did not get screwed. You are doing exactly right, getting into a better, more appropriate loan.

In your original post you were referencing a 6.5% loan. Why are you not qualifying for that loan? The interest rate of 7.9% you wrote in the last post is nowhere close to what you should get with decent credit. Based on that, it looks like you are still having some credit issues.

Well all that was as confusing as what i signed but thanks for the info. 1St I never said that what was happening was illegal. The point i was making is that its all just bad buisness in MY opinion. I believe that i took resposability for what i signed but as with your letter it was all just legal mumbo jumbo.

the point being that just because its legal does not make it right. I am not a educated man as is the case of most people that get these loans. we are just hard working people trying to have a little something in this world to call our own.

So while legaly and apperantly to you this is just fine even though i have made payments on time and thatincludes all my bills it still amounts to not caring for those making a honest effort only about the bottom line and what can be gotten away with hidding behind legal terms and such.

I believe in a better world than that. so to me it is wrong and i think you will find that there are alot of other people who are tired of being taken advantage of simply because we are not fortunate or wicked enough to to be in the club elite of the rich.

as for the refinance i was in the process of that when i got the letter and am going to have a fixed rate before the vultures get to me which at this point is looking like about 7.9 so the final word is that they are preditors and will take full advantage of any loophole or whatever to get the most out of their customers pocket.

my biggest mistake was faith that they would play fair and if you think that they are then i feel sorry for your sense of values. however thanks for the info.

I understand you are not happy with the big increase Ronald, but I don't believe they are doing anything illegal. I am a mortgage broker, I sell these type of "credit repair" loans as needed and I also refinance people out of them too. Let me explain how the rate adjusts, and you can get out your loans forms and verify what I am writing. Anybody else with adjustable rate loans can do the same.

Get out the "Adjustable Rate Rider" or "Adjustable Rate Addendum" from your loan files. This information will also be on the "Truth in Lending" disclosure.

You had a start rate or initial initial rate of 7.5% fixed for the 1st 2 years. I am assuming this fixed period is up on Nov. 1.

On the Adj Rate rider, there are the following terms defined and a value assigned to each. You have the "INDEX"---In your case the 6 month LIBOR, which this month is 5.37%. You also have a "MARGIN", which on a non-prime loan like yours is usually somewhere between 5%-7%. You also have "CAPS" or maximum increases/decreases, your case 3% on the first adjustment, 1% subsequent adjustments.

OK, here is how your loan is adjusting. Take your INDEX (this month's 6 month LIBOR) of 5.37% ADD your "MARGIN" (look on your note) of approximately 6% and you get 11.37% interest rate. Now, because you have a 3% increase CAP, your rate can not be more than your start rate of 7.5% + 3% cap = 10.5%.

As far as the subsequent adjustments every 6 months, your interest rate will continue to adjust upwards until such time as it equals the 6 month LIBOR index plus the margin specified in your note.

Your current credit rating or payment history is irrelevant to how this loan is currently adjusting. It is all defined in the mortgage contract you signed when you bought your house. If you get your paperwork out and find the pages I am referring to, you will see this. There is nothing predatory about these type of loans. Their sole purpose is to allow a buyer with less than perfect credit to obtain a home loan. The expectation is that during the 2 year fixed rate period, that the borrower would fix any credit issues they might have and then refinance out of this loan into a loan with better terms and rates.

In your post you mentioned the "prime rate of 6.5%". The US Prime Rate is 8.25% today. The US prime rate has nothing to do with mortgage loans (other than 2nd mortgages). Possibly what you were referring to is a typical 30 YR fixed rate loan being at about 6.5%. While that is true, your particular loan scenario may not fit into that category. The rate is determined by several factors; your debt/income ratios, cash reserves, loan purpose, loan size compared to the appraised value of your home, the type of loan program, and your credit history.

I know that was a lengthy explanation, but I guarantee is 100% true. Here is my suggestion. Ask some friends, co-workers, relatives for a referral to a mortgage broker they may have used and were pleased with the service. Gather up the following items: Current mortgage statement, last 2 pay check stubs, 2004 and 2005 W-2s, last 2 months of bank statements, any 401K, retirement accounts, IRA's etc. Call the mortgage broker, get him to run your credit. Ask a lot of questions, don't feel pressured to take a bad loan.

Good luck!