Kellum’s korner: Homeownership - the American dreamAnthony O. Kellumcredit, delinquent payments, Interest-only products, adjustable-rate mortgage
Long before I became the Anthony Kellum that I am today - before
the recognition of Crain's 40 Under 40, president of the Michigan
Mortgage Brokers Association, or the guy on the news who gave
houses away for the holidays - I was Anthony Kellum, the guy with
bad credit and a dream. I was a man with humble beginnings and an
unquenchable desire for success.
Reminiscing to the early '90s brings back memories of my first
house and how much I wanted this house with everything I had.
However, poor credit and a new job isn't a strong compensating
factor. Therefore, I negotiated to purchase the house through a
land contract at an interest rate of 11 percent. This was the best
day of my life. My wife and I were ecstatic. For the first time, my
children had their own rooms. Whenever I pulled up to my driveway,
I would think, "This is my house." I could finally see the wheels
turning as I was moving forward.
I am proud to say I was able to pay my land contract on time.
All delinquent payments on my credit report were negotiated with
creditors and paid. This enabled me to obtain a loan through a
local credit union to pay off the land contract. My interest rate
decreased from 11 percent to eight percent. My payment decreased,
which made living a little more affordable.
Someone took a chance on me. That piece of property began the
whole dream to Kellum Mortgage. The back room of my first house was
the soil used to nourish that opportunity; little did I know this
opportunity would explode into the opportunity of a lifetime. Thus,
a dream was born in the back room of that very house in 1995.
Today, the mortgage industry is more focused on fulfilling
profits than dreams. I think both can be accomplished. I paid
$30,000 for my first house in Detroit. The cost of my next house
was $250,000. Not bad, for a guy who could barely get a loan for
$30,000.
With that said, I receive numerous calls and e-mails that
lenders are not doing loans in urban markets. The consistent themes
to the calls are "Anthony, what are my options? Is there any hope
to my situation?" Instead of looking for compensating factors, the
lenders are scrutinizing the loan package for any loophole to deny
the loan. This is more than how I feel; it is what loan officers
who try to service urban markets are facing on a daily basis.
Lenders are not just denying loan applications in the urban
market, but they are denying dreams. Those dreamers may be the next
Oprah Winfrey, people who simply need the opportunity to flourish.
Can you imagine how many dreams have been killed because of a lack
of opportunity? A loan application is more than the loan
amount.
True accountability is giving someone a place to grow.
Interest-only products and adjustable-rate mortgage products are
designed to assist buyers in qualifying for a mortgage. Lenders are
not willing to lend in high foreclosure areas, but are more than
willing to add to the foreclosure rate increase through products
and lack of education in the community. I am fully aware the
economy plays an intricate part of foreclosures. However, lenders
are providing products and placing borrowers in products that will
only worsen the situation and turn a buyer's dream into a
nightmare.
It is time to sit down and come up with some solutions among
Wall Street, corporate America and you. The value of your home
should not be cut simply because the lender is not comfortable
lending in urban markets. You should not have difficulty
refinancing your home because the lender realized you reside in
Detroit. Those who own homes are more likely to go to college,
become positive stakeholders in their communities and less likely
to go to jail.
What is the true cost of a dream? Should it have a numerical
value, or a value full of substance? Hard work, plus the will to
succeed, should equal opportunity. I am a living witness that
dreams do come true. However, they cannot be recognized without a
chance or the opportunity for the dream to flourish. Keep in mind,
the loans we make can be the start of some amazing things.
Anthony O. Kellum is a past president of the Michigan Mortgage Brokers
Association, as well as a speaker on a variety of topics
regarding the mortgage industry. He may be reached at (248)
866-9292 or e-mail
[email protected].
