Somebody had to think of this: Golden 1 Credit Union is touting a new mortgage repair loan to put subprime borrowers who lost homes back into new ones within 18 months. The Sacramento-based credit union has set aside $20 million to steer 50 or more foreclosed households into new 30-year fixed-rate loans for a second chance at home ownership.
Typically, your post-foreclosure credit is ruined for years and even then, the only home loan you might get is the higher-cost variety that got you into trouble in the first place. Golden 1 says it is part of the solution to this lending mess - none of which it contributed to with its conservative lending standards - to get people back into houses as soon as possible.
The program will not be for everyone. It requires a job, a 20 percent down payment, debt counseling, full documentation of income and a credit score of at least 600. Investors need not apply. The maximum loan amount is $417,000.
It is only $20 million. But this is an indicator that some in the financial world are thinking about what comes after this mess. Good people will need a second chance. The biggest credit union in California is offering one.
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