Hackers, Pirates and Phishermen

Hackers compromise annual credit report sites


Look out!!

Hot off the electronic presses:  The TBWS Daily Show reports that hackers have been compromising at least two credit report sites:     annualcreditreport.com and creditreport.com  Apparently they’ve found a way to enter these sites (and others) and steal credit information, which they then sell. 

We’re told that a credit report with a middling credit score (680) sells for around $40, while a report with a higher credit score (740) sells for about $80. You can imagine how many stolen credit reports these pirates need to sell to maintain their supply of rum and hearty wenches.

AAAARGGGHH, LADDIES!  THERE'S A DANDY FICO!!

There’s a dirty little secret here that everyone should know about. There is only one legitimate site (www.annualcreditreport.com) where you can get your credit report for free. The rest of the sites that offer "Free" annual credit reports are bogus profiteers that have cleverly designed their site names and their interaction with search engines like Google so they show up when you try to find the free site.
And when you click on the link to one of them, you discover that they want to charge you for the credit report!They rely on the fact that most people, after a few tries at finding the free site, give up in disgust and pay the $5-10 to get what should be a free report.

The whole thing is like, well, pirates! Electronic pirates. They hang around the internet, cleverly disguising themselves as legitimate businesses, and either steal your confidential information or make you pay a fee for something you could get for free.  It's called "phishing".

When you think about it, why would anyone in their right mind give their social security number and other personal infomation to an anonymous website that claims to furnish you with a credit report?  Isn't that a little too trusting?

"Dear Customer (the last panel says) This is your bank. We forgot your social security number and password.  Why don't you send them back to us so we can protect you?"  And the pointy head boss says "Looks legit".


By the way, once you get your “free” report, and assuming your information hasn’t found its way into the clutches of the evil pirate hackers, what have you got? Not much. In particular, you don’t get any credit scores. Nope. Not even one. All you get is a lot of verbiage. The only time you can get a useful credit score is when your banker or mortgage lender orders the report on your behalf.

My advice?  Don’t get your credit report from someone who advertises on the internet or on TV.  You wouldn’t  choose a brain surgeon on this basis, so why entrust your social security number and the safety of your credit information to someone who you don’t know and have no reason to trust?  If you don't know a web site, the safest assumption is that you should never give it your confidential information.

Instead, have your credit checked by your lender (we can do it for you) if you want to see your credit scores.  At about $20, it’s a safe and low cost  approach.  And if you don’t need the credit scores, and want to wade through the verbiage?  Go to www.annualcreditreport.com. 




Okay, now it's time for Ask Mr. Mortgage; your opportunity to have the best brain in the business answer your personal question about the mortgage business.  Here's today's question.


Ebenezer in Drain, Oregon writes: "When will the market react to all the good news and the Dow reach 14,000"?

Mr. Mortgage replies:

Eventually, but perhaps not in our lifetimes.   

This whole debacle has underlined the fragile nature of our interdependent world economy.  There are a number of significant influences slowing down our recovery, including the increasing costs of doing business in the US and (the biggest problem) the deadlock in Congress. 

Much of the good news about mortgage rates (that they’re low) is driven by the flight of foreign capital into the US market, thus pushing down yields on government debt.  This is nice, but it’s not a long term strategy we want to adopt. 

In the meantime, every piece of news that would benefit the market is offset by some news that is negative.  Until a solid trend is established, so that the good news fuels increases in stock prices based on investor confidence, and the bad news can be given less weight, a high Dow Jones doesn’t seem likely. 

In the meantime, it’s a great time to buy a house or invest in real estate.  That’s enough to make us mortgage bankers happy."

Yours Truly,

Mr. Mortgage................

Ready to give up yet?  Want some more advice? Of course you do. Admit it!

Okay, here's some: go to an out of the way place in Mexico for a week, far away from touristas, the telephone and the internet. Soak up the sun, read, write, take walks on the beach, drink some rum and look for pirates; maybe for some pirate wenches.  Do some real deep sea fishing. 


That's what I'm going to do. 


That's my brother Mike and his wife Jackie in the photo.  They run a little resort in Puerto Escondido four months out of the year.  I'm going to visit them for a week and make sure there are no pirates about.  The way I look at it, this is a business service I'm providing, and so the cost of the the trip should be deductible.  Wouldn't you agree?


I'll have photos in my next posting.  Might even find a pirate, or a phish or two.  There will not, however, be any photos of pirate wenches.  For those, I refer you to the bathing suit issue of Sports Illustrated.


Adios, Amigos!


John DesCamp
The Legacy Group 
503.780.7743
MLO #114798

What's with the animals?

So, here's the first edition of the Centsless Times.  Thanks to my friend, Sean Seidell, for the idea for the name.
Now, about this first posting (your're thinking).  This is a strange way to start a blog that claims to be about financial matters.   A dog and an elephant? 

Well, not so fast.  Let's start with Margot.  She's my grand dog, and lives with my daughter Robin.  She also has the perfect look; that look of irritated disbelief we all have when we read what a train wreck the mortgage lending industry is right now, thanks to Barney Frank, Chris Dodd, and the major banks.  "You can't be serious" she says.  We'll see more of Margot and her look.

Then there's our elephant (courtesy of Shutterstock). His name is Banks, Biggy Banks.  He's the mascot for the big banks; the ones who created the mortgage mess, and then said to the timid and venal politicians (Senator Barney Mouse) "Hey, boss! Here's some more campaign funds.  And don't let anyone blame me for this mess!  It wasn't me! It was those wicked independent mortgage lenders.  And of course, all those borrowers who should have known we were selling toxic mortgage products.  So don't blame me!"

Finally, there's Charlene.  She's here for the humor, but definitely not for any unwelcome information.

More on Charlene later.

Something substantive?  Well, okay.    How about this? 

A client asked me: What's the lending climate now for someone with good credit?  Do you have to have a minimum of 20-25% down?  What else do you need to get financing?  And how long do you have to be at your job?

The answer: The lending market is still good for borrowers with good credit.  Interest rates are low and there is a large number of good properties on the market.   What's difficult is the loan process itself.  Not surprisingly, the federal regulators responded to the mortgage meltdown with a host of new regulations.  In addition, each of the big banks piled in with their own requirements, which are layered on top of the federal scheme.

Some questioned whether the people who made the mess were the ones who should write the new rules to fix it.

And some of the new rules were helpful.  But most of them were either ill concieved or else designed to drive the independent mortgage lenders out of the market.  This has done great damage to the housing market and to the mortgage industry.  As a result, the economy suffers.

So the process of doing a loan is now immensely more complicated because there are many more questions to be asked and answered.  Our processors and underwriters spend almost twice as long completing a loan as they did a few years ago. 

That said, loans are still available with as little as 3% down, although any loan with less than 20% down will almost invariably require mortgage insurance.  And if you’ve been at your job for two years, have good credit and enough income to qualify, then you have the basics to get a mortgage loan. 

As a rule of thumb, your monthly payment for principal, interest, property taxes and insurance should be not more than 35% of your gross monthly income, although there are exceptions that will let you go up to 50%.

That's all for now, folks.  Have a sunny weekend!

Getting started

Today is the first day of the rest of my blog.