We Can Save Washington Mutual and other Banks by Overpaying our Mortgages

Washington Mutual Home Loans Logo - My Mortgage Company

I think we, the mortgage holders and general citizens might be able to help in the credit crunch going on right now in the news. I am hearing so much about the Lehman bankruptcy and the AIG de-valuing today. Certain sectors of the economy are in shambles due to over leveraging and greed on the part of the top level executives in these banks and financial institutions and we really don’t know how deep this will go.

As much as I hate their greedy asses for getting us into this mess, (just to get another bonus to buy another yacht) I think you and I may be able to help so things don’t get worse. I think that if everyone that has a Washington Mutual (WAMU) Mortgage (like me) pays extra principle over the minimum ammount every month the cash on hand will rise above expectations and help keep the company running. I am currently paying $150.00 over my minimum now and my brother pays $250.00 over his minimum payment also.

The thing is it benefits you too! If you pay extra on your mortgage now it cuts payments off at the end of the mortgage and that saves you the interest that you would be paying on those payments. So, in my book this is a win-win situation. And don’t give me that line about mortgage interest tax deductions, that is only 25% back in credits on your money. It’s not like you get all of it back from tax deductions. Its still better to not pay the interest all together and save 100%. Duh.

You may be “saving” that money for when “financial armageddon” happens but really… those of us savers have been saving for years and have plenty of “cash on hand” now. We should pony up and get these mortgages paid down. It seems like the responsible and needed thing to do. Plus it gets a better return than a new handbag.

If 1,000 people pay $100.00 extra on their mortgage that is an extra $100,000.00 a month and an extra $1.2 Million a year for WAMU to keep afloat. If 5,000 people pay $150.00 extra on their WAMU mortgage that is $750,000.00 extra cash per month and $9 Million more per year. And 10,000 people paying an extra $200 a month is $24 Million a year. (which should do some good)  This may be small potatoes for a banking snob but it all adds up and is scalable since WAMU must have thousands upon thousands of mortgages out there.

Anyway, take it for what its worth and see if you feel like making a contribution to the capital that banks and mortgage institutions have on hand in this economy.

Now I do need to add a few disclaimers to this idea:

1. If you are having trouble making ends meet, this post or idea is not for you. Keep paying the minimum each month and move on to cash saving strategies pronto.

2. It is no one’s individual responsibility to do this especially if the job market is not good and they say to have a year in cash living costs on hand if you loose your job. Make sure you have that reserve first to protect yourself. 

3. We don’t owe those rich asses anything extra beyond minimum payments, but it might help the general economy and us all in the long run. And if you know one of those greedy financial execs, egg their car or something. Make it personal.

 

Update; um, this didn’t work. WAMU got bought, eaten and taken over by Chase bank. Poo.

The U.S. Mortgage & Lender Mess

The mortgage and lending crash just keeps getting worse. I don’t know which is worse, the people not reading the contracts they sign and not understanding the terms involved with a baloon payment or adjustable rate or the banks and financial companies offering such bad manipulative terms. It seems like no one really did any research before buying these properties and now they are all foreclosing. I was just reading that the number of forclosures has doubled in the past 12 months for the month of September year over year. Yikces! And they say this isn’t the last of it. How many people are going to be loosing their homes and foreclosed on at Christmas and over the holidays? This is such a disaster for this country as a whole and a little embarassing to the rest of the world. Here we are suposedly the most wealthy nation in the world and people are loosing their homes. It’s sad and it’s the result of people not doing adequate research and getting bad mortgage advice from predatory lenders. Do yourself a favor and stay renting until you have 20% to put down as a down payment on a home and then do your research and go with a lender who has lent to a friend who has not had any problems with their mortgage and has had it for more than 5 years.