Old-fashioned mortgage banking offers buyers a chance
By Bo Petersen
All of a sudden nobody could get a mortgage, least of all Lisa McLean.
The Post and Courier
Lisa McClean leaves her North Charleston home Monday evening with sons Eldrick (center), 11, and Tre', 15. McClean got a mortgage when Metanoia Community Development Corporation teamed up with Atlantic Bank and Trust.
The economy had imploded, largely on the weight of the bad handling of mortgage investments by traders.
McLean had struggled for years to repair her credit after a failed marriage. She paid her rent on time. She paid her bills on time. She works as a secretary, has a child in college, two more at home. She was on the verge of finally getting a home of her own when the bottom dropped out.
"I knew I didn't have a strong leg to stand on," she said. "They really have to want to take a chance on me."
What came to her rescue was mortgage banking the way it used to be.
The one chance McLean had was Metanoia, the community development program in North Charleston's Chicora-Cherokee neighborhoods. But Metanoia's affordable housing outreach was dead in the water. The group had two homes completed, three more under construction. It had a record of success with five previous homes, finding prospective homeowners with credit problems, giving them financial counseling and training.
But the two clients ready to buy homes had their pre-qualified mortgage applications returned, stamped "no."
More info
Pushing Forward.org - the official web site of Metanoia.
"With a national credit company, all they're looking for is a credit rating," said the Rev. Bill Stanfield, chief executive officer.
For the Chicora communities, the recession wasn't anything new: The area had 11 percent unemployment in 2000, when unemployment statewide was at 3 percent. This was insult to injury.
The Post and Courier
The answer was as folksy as George Bailey in the classic movie "It's a Wonderful Life": Old-fashioned, person-to- person banking. Stanfield and the program's housing director, Tony Joyner, teamed with Scott Sylvester, Atlantic Bank and Trust market executive, to provide mortgages the bank keeps in house rather than selling to a mortgage company.
Banking the way it used to be, oddly enough, Stanfield says. The bank's role helps it meet a federal obligation for investing in the community. Metanoia agreed to continue working with homeowners; they make mortgage payments to a Metanoia escrow account five days early, so if there's a problem counselors can find a way to work with it.
The Post and Courier
Metanoia's Bill Stanfield (left) and Tony Joyner (right) are working with Atlantic Bank and Trust's Scott Sylvester in an affordable housing program.
"If the bank has questions, they call us and we talk them through it," Stanfield said. In a worst case scenario, Metanoia would buy back the home to keep it from foreclosure.
Metanoia's role is the key, Sylvester stresses. The group provides services the bank wouldn't have time or people for: that ongoing counseling, screening hundreds of clients to find the ones ready for mortgage and the one-to-one training that helps them make it.
"We try to get past those (credit) issues and look at the big picture. But what really makes the difference is Metanoia stays involved," Sylvester said.
It's a relationship forged by Stanfield, who sold Sylvester on the program when Sylvester showed up for the ribbon-cutting on an earlier home he provided a loan for. He found Stanfield inside, doing last-minute painting himself to cover a cost overrun.
Previous story
Metanoia looks at 5 years of progress, published 07/20/07
But Sylvester concedes that maybe one way out of today's mortgage mess is not to do what got the financial world into it. Local banks could hold on to more mortgages instead of selling them.
"I think they should in today's market, to help people re-establish credit," he said, "and certainly for people who have good credit."
Reach Bo Petersen at 843-937-5744 or bpetersen@postandcourier.com.
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Comments
CannonMan (anonymous) says...
There is a mentality problem that needs to be solved if we are going to get out of this financial mess - not everyone should own a house. What is wrong with just renting?
February 24, 2009 at 1:58 a.m. ( permalink | suggest removal )
moonpie (anonymous) says...
CannonMan your right but apparently way back when the Clinton administration didn't see it that way. They requested the banks and fannie and freddy lighten up a bit and loosen the reins.
February 24, 2009 at 6:14 a.m. ( permalink | suggest removal )
justbeingme (anonymous) says...
If you meet all of the requirements to become a homeowner & have insight of your responsibility, why not become an homeowner. This lady overcame a financial situation that is unfortunately familiar to a lot of folks. But she did what was required of her. Enjoy your new home !!!
February 24, 2009 at 7:26 a.m. ( permalink | suggest removal )
majorjohnson (anonymous) says...
It had a record of success with 5 other homes, and has 5 more completed or being built. That's after going through hundreds of applicants and they've been at this for 5 years. How are these people making a living? You can't run a business like that. Selling 5 homes might support an agent but not a business, it sure won't pay full time staff salaries and not over 5 years. This looked suspicious to me so I checked it out. Did the old time mortgage bankers get their clients up to $20,000 in taxpayer funded grants for their down payment? Did they rely on taxpayer funded grants and donations to maintain their operations? Did the old time mortgage banks have things like "We seek to embody the Spirit of God within a specific community" in their literature? Nothing against the people buying or selling these homes, but a whole lot of information got left out of this article for some reason, and most of what got left out is that we seem to be paying for a big chunk of these houses with our tax dollars.
Metanoia's web site is http://www.pushingforward.org, go see if that looks like an old fashioned mortgage bank to you.
February 24, 2009 at 8:14 a.m. ( permalink | suggest removal )
voxpopuli (anonymous) says...
Metanoia is a great organization doing what others can't or won't do. Go down and visit Rev. Stanfield and his group before you run your mouth. Metanaoia needs everyones support.
February 24, 2009 at 9:02 a.m. ( permalink | suggest removal )
oldglory (anonymous) says...
major - you're are quite right, certainly not anything that I remember from old-time-morgages. Thanks for the reference, and I found it a bit disconcerting.
February 24, 2009 at 9:09 a.m. ( permalink | suggest removal )
JohnGalt (anonymous) says...
Old-fashioned mortgage banking also required 20% down.
February 24, 2009 at 9:09 a.m. ( permalink | suggest removal )
majorjohnson (anonymous) says...
I didn't say anything for or against Metanoia voxpopuli, I just pointed out that this article is incredibly misleading and lacking in substantial information.
February 24, 2009 at 11:28 a.m. ( permalink | suggest removal )
GeecheeBoi84 (anonymous) says...
I see ya Mama McClean!!!! And you're head-on justbeingme, she HAS overcome a lot, and fully deserves to own that house, or any other she so chooses! It's nice to see people reap what they sow!
February 24, 2009 at 11:43 a.m. ( permalink | suggest removal )
MsDunnDunn1 (anonymous) says...
Thank you Jesus!! I am so proud of my BEAUTIFUL Mother Lisa J. and Talented little brothers Tre' and Malik we have come a long way and finally We as a FAMILY can call it OUR OWN!! When Praises go up, Blessings Do Come Down!! Despite any negative comments on this story by any of you people know that we will pray for ya...LOL!! My Granny is Smiling down on you (RIP Granny Harriet B. Johnson). I Love Her Cause She Got Her Own...
Your Only Beautiful Daughter Ms Dunn Dunn
Love you LaQuan, Tre', Malik, Blackie Chain, Keyaira, Qwanajah, Uncle Eddie, and MY MOTHER Lisa Johnson McLean!!
February 24, 2009 at 12:29 p.m. ( permalink | suggest removal )
flinsc (anonymous) says...
People do not deserve anything, they earn it.
February 24, 2009 at 12:31 p.m. ( permalink | suggest removal )
palmettotree (anonymous) says...
I looked at everything that I could on the website. I think that it is an outstanding opportunity. With homeownership comes a big responsibility. Isn't that what we want to show our children and have them learn? Though that really isn't a safe neighborhood, I myself have always felt like that is where I want to live. You know around the old Navy Base. I love the park circle area. Too bad hubby doesn't want to move there. Yeah I have mentioned it to him. He loves West Ashley.
I wish all of the new and future owners alot of success in their homeownership.
February 24, 2009 at 12:34 p.m. ( permalink | suggest removal )
GeecheeBoi84 (anonymous) says...
flinsc: deserve and earn are synonyms... don't start
February 24, 2009 at 12:58 p.m. ( permalink | suggest removal )
regulardude (anonymous) says...
flinsc - Your statement is a bit broad. Certain people do deserve certain things. Such as the elderly who have worked their entire lives to provided for future generations such as yourself. Or someone who is disabled. If you're referring to Ms. McClean, your statement is ridiculous. Can you read? She has earned her home genius.
February 24, 2009 at 12:59 p.m. ( permalink | suggest removal )
brandon_teyaW (anonymous) says...
Congrats Aunt Lisa and kids....
February 24, 2009 at 1:56 p.m. ( permalink | suggest removal )
GG (anonymous) says...
I saw a report on a national news program about a similar program in a depressed community up north. The small mortgage company director said that while their lending agency didn't make a tremendous profit, they did make some. He stated that the percentage of folks making payments on time and consistently was 98%. They only made loans for a 30-year mortgage at the lowest rate possible per client.
Maybe these small mortgage companies is the way to go. Seems the government ones like Freddie and Fannie are a big bloat of bureaucracy.
February 24, 2009 at 2:04 p.m. ( permalink | suggest removal )
majorjohnson (anonymous) says...
Again, this is not a mortgage company, nor is it a bank. It's a taxpayer and donation funded church group acting as a funnel for people to get tax dollars to buy houses. As far as "deserving" a house, how do I "deserve" to involuntarily provide someone I don't even know with 20,000 of my favorite hard earned dollars?
February 24, 2009 at 2:51 p.m. ( permalink | suggest removal )
yird (anonymous) says...
I know little about mortgage companies having not dealt with any in many years so I can't add or detract from this except to say that if the lady makes her payments I see no harm done.
She can't be any less deserving of assistance then those who bought and sold, and bought and sold, until the profit they made on their more modest homes enticed them to purchase a home they could not afford, and now the government is supposed to bail "them" out?
February 24, 2009 at 6:54 p.m. ( permalink | suggest removal )
JC (anonymous) says...
There should be more Metanoias and less american greed. Ms. McClean has shown she is resonsible and shown her worthiness by building her credit score up and paying bills on time. There are people out there with a lot more money and that are irresponsible and everything comes first before paying bills. Shame.
February 24, 2009 at 7:39 p.m. ( permalink | suggest removal )
buff_o_rilla (anonymous) says...
Just another Government Bail out or Bail in, When is it ever going to end?
February 24, 2009 at 8:25 p.m. ( permalink | suggest removal )
GeecheeBoi84 (anonymous) says...
buff_o_rilla: I know, innit?! I dunno WHAT'S da deal with all these "bailouts", especially since the economy's doin so well... I mean, WHAT RECESSION, nahIsayin?!
February 24, 2009 at 10:29 p.m. ( permalink | suggest removal )
buff_o_rilla (anonymous) says...
Yeah Geech,
Imagine thinking doing the same thing that got us into the situation is going to save us!!! Debt, Debt and more Debt. It never ends. Let things fall and let the strong survive!!! Are you strong Geech or do you need the GOvernments tit to live off of?
February 24, 2009 at 10:39 p.m. ( permalink | suggest removal )
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