Ditto: Ditto: Ditto! I just had my encounter with the “salesman” or how they prefer to call it, “the loan representative” that can provide you all the answers that they won’t over the phone, and even then only after having to sit throught the entire presentation. Their script was verbatim to what others have posted, and the lines went according to plan. Of course all along, Richard (with his English accent) was trying to size me up and looking for an opening on which he could create a connection with me, “What kind of work you do”?, “Where are you from”?, etc. I should have told him I was with the “FBI White Crime Division” and would have loved to see his jaw drop and see how quickly he would have ran out the door(LOL), but instead I told him the truth that I am a Budget Analyst (Finance Major, MBA w/Finance concentration), and Certified Financial Planner candidate. Nonetheless, he still tried to convince me that I was better off with Amerigroup even after I tripped him on a few occassions on his use of terms (they love to use that term SAVINGS) and misleading calculations. I finally told Richard that I had to think about it and perform my own calculations before I made any decisions. Of course as some of you have succinctly mentioned, that is when the ante went up, and the cue card said; “May I use your phone to call my manager.” Of course, once she got on the phone she gave me the full-court press again, “Thank you, for your service, ” YADA! YADA! YADA!, they even asked for the Mrs. even though I’ve been divorced for over 11 years and had already told them I am not married(LOL). Well, I also gave her the “thanks but no thanks” answer and waved good bye to Richard as he raced from my house, and now that I think about it he seemed not to please with me ( Ha! Ha! Ha!). Nonetheless, I all along suspected it to be a “scam or on the too good be true category” and my defenses were up from the cold call, to the we can’t tell you costs till we sit with you, to the you need all these documents, etc. etc, but hey I played along anyways (it was a slow Saturday ).
The bottom line is this:
1). Reputable business entities do not have anything to hide and have no problems leaving you their quotes, or other information to include their “What if scenarios”, Good Faith Estimate, etc. (i.e., laying their cards on the table for you to see and compare against other business and make the best decision for YOU and YOUR FAMILY). However, somehow Amerigroup has an issue doing so under the “is copyrighted so I can’t give it to you” pretense (too funny…still laughing about that one, because it would still be protected by the copyright laws wheter he gives it to me or not, if indeed it is copyright protected).
2).The Veteran Administration (VA) does guarantee Interest Rate Reduction Refinancing Loans (IRRRLs) which the “Hybrid” this company provides falls under. However, by no means that indicates that the VA endorses Amerigroup (like they would want you to believe) and their shady business practices. There are plenty of other VA lenders out there with different types of VA Loans that may be more beneficial to you without being forced onto a “once size fits all” type of loan. Go to the actual Veterans Administration Web Site (not one created by these companies with VA Loans plastered all over it that for the most part mislead you) http://www.benefits.va.gov/warms/pam26_7.asp and read Chapter 6 and you will see the MINIMUM hurdles anyone with money willing to lend for refinancing has to adhere to (trust me not much as long as they qualify themselves with the VA as a lender). Namely: 1) a reduction in the interest rate from the original loan, 2) a reduction of principal and interest payments. However, these small inconveniences can easily be overcomed by 1) having you pay points up front to reduce the interest rate (Amerigroup as I am sure other lenders do this; the VA permits reasonable any reasonable amount of discount points in cash, and up to 2 points to be rolled onto the loan) 2) adjusting the term (years) of your existing loan (VA permits up to 10 years from existing loan but no loan term greater than 30 years). (What are points you may asked? Basically there are two types of points (origination and discount). Each point represents 1% of the loan amount in cost that go either for the lender to recoup costs (origination) or to buy down the interest rate (discount). See link for detail explanation http://www.moving.com/articles/mortgage-loan-points.asp.
3). Everyone should look at their situation and put pencil to paper either before or after the sales pitch to see if it makes sense in your situation to use the “Hybrid Loan” or any kind of loan for that matter. Do not, I repeat DO NOT fall for the “you got to make the decision today” plot. It is true that interest rates fluctuate daily but that rash decision can cost you much more in the long run. There are only 3 variables used in the calculations of amortized monthly payments and they are: Present Value (Loan Amount), Interest Rate (monthly rate= Quoted rate/12), and Periods (No. of Years of loan/12). However, depending on your situation and how long you plan to stay in your home warrants the consideration of re-financing. At the end of the day all you want to know is, “am I in a better off financially before or after I enter into this deal.
Main two scenarios:
A). I am moving within a few years and have no intention of paying off this house, does it make sense for me to refinance?
To find out if it makes sense to do it or not divide the cost of refinancing by the difference in payments from your current loan vs. proposed loan. If the product is less than the number of months you plan to stay in the house then it makes sense to re-finance.
Example:
Current Loan Pmt. $1, 500 - proposed loan pmt. $1, 300 = difference $200. Refinance Cost = $12, 000. That means it would take you $12, 000/$200= 60 months or 5 years to recouperate the cost of refinancing and from then on you’ll be better off. In this instance if you don’t plan to stay in the house for longer than 5 years do not refinance because you will not have a financial benefit until the 61st month. You might have lowered the monthly payments but you are not better off financially and simply benefited the mortgage lender.
B). This is a home I intend to pay off and keep and I simply want to minimize my total costs.
To find out if it makes sense to do it you must do a total costs calculation. Because there is timing and interest factors that need to be taken into consideration in order to do a fair comparison, a total payments calculation is better suited to find out if you are better off. After all what sense would it make to lower my payments by $200, $300 or $400 if the terms are lengthen by 10 years.
Example:
Current loan Pmt $1, 500; payments left 260 =total costs $390, 000
Proposed loan Pmt $1300; payments on new loan 360 = total costs $468, 000
In this example you would pay an additional $78, 000 in total costs (plus any additional out of pocket expenses not rolled onto the loan). Hence, it wouldn’t make sense to re-finance.
The issue gets muddier with an ARM because the uncertainty of future payments varies and will increase or decrease total payments between the options.
Good payment calculators can be found on line one good one is bankrate.com or you can Google mortgage calculators and use other sites.
P.S. Bottom-bottom line- if you are not at ease visit a local professional that can explain it to you in understandable term until such time you are at peace…PERIOD!!!

Received the same letter as others in the mail. Could not get a straight answer from the phone reps said the loan officer would explain all when he arrived at my house. After viewing the chart presentation I told him I was not interested. About 10 minutes later he asked to use my phone to call headquarters for his report status. Same bs again from the man on phone. Told him not interested and about 5 minutes later I handed back the phone to his rep at my table and asked the person to leave NOW. Mission accomplished. Wasted one hour and 15 minutes of my time on a Sunday morning. Don't waste your time. This is a 38 month Hyrid Loan not 30 year fixed as the rep on phone stated.

Peter, The same thing happened to me today. The monthly savings was overstated on the original phone call. How can they get that wrong? I'm sure they have a better amortization program than I have access to. The fees and expenses are huge, so I was already doubtful about the whole deal, but then the guy asked for a check for $1, 300+. No longer any doubt, I was done (I thought) at that point. WRONG! Then the guy calls a manager (I guess) and she just won't take no for an answer. After 10-15 minutes of that (seemed lots longer) I handed him back his phone and told him to tell her, if she ever paused to breathe, that I was definitely not interested in any of their products today, that after careful consideration for a day or two I might be. He gave me his card and politely left. It was only after he was long gone that I discovered that he had taken all the facts and figures we had worked up with him, making my further consideration impossible. Bein' polite and wearin' a suit ain't enough. Stay away from these guys. They'll be tricky if you let 'em.

I got a solitation notice in the mail for a 'VA Mortgage Payment Reduction Program' with phone number 1-866-747-6987. I called to find out details about what the current rates were and to get a good faith estimate. They asked for my current loan balance and interest rate. They told me that I could save $390.00 per month but could not give me any details as to fees, points, etc. over the phone. They said they only take applications in person and that they would send a loan officer to my home. I specifically asked if this was a fixed rate loan, with no adjustments in interest rate after some initial period. I was told that it was a fixed rate loan. They told me that the loan officer would provide full details. They said it would take only about 15 minutes and it would be no pressure. I scheduled an appointment for the next day.

They guy showed up right on time for our appointment. I asked for some specific information regarding term of loan, points, fees, but was told that all my questions would be answered during his presentation. First red flag was that although I was told on the phone the day before that this was a fixed rate loan, it turned out to be a hydbid loan. The initial low rate was lonly guaranteed for 38 months, after which it became a variable rate loan. No other options were made available. After his hour long presentation, it was clear to me that the promise of significant savings was misleading. The points, fees, etc would add a significant amount to the existing loan balance, such that at the end of 38 months, the balance on the new loan would be about the same as it would have been under the current loan. Any savings after that point were not guaranteed.

After a round-about way of getting the information, I said I wanted to do my own calculations (I am an accountant) and that I would make a decision within a few days and get back to him. He then asked if he could have his manager talk to me, using my phone. The manager spent more of my time trying to convince me to submit an application on the spot. I was not given the opportunity to keep any of the paper with the calculations the loan officer had made.

In my opinion, this company is using misleading tactics to sell their product. As an accountant it was easy for me to see the bottom line for me. This product may work for some, but do not rely on the sales pitch to make your decision. Do your own math. Other mortgage companies I have dealt with have always been willing to fully answer questions as well as provide a good faith estimate without the hassle of sitting though a sales presentation. The loan officer was polite, but it was a waste of time, because I was not told initially that this was not a true 30 year fixed rate loan.