Banks don't lend their own money when you get a mortgage. Instead, they create a line of credit based on your score and income, then sell it to an investment trust. A Minnesota court case forced a bank president to admit under oath the bank never loaned any actual money.
Tell us about that. The whole world. Most people think, because I have this conversation all the time, had it today with my chiropractor, people think that the bank is taking money and paying the person whose home you bought. But no money actually gets exchanged. A negotiable instrument is created and then the gets sold to the Remic trust. How does the person who owned the house that you purchased get tangible money to conclude the purchase?
I so understand. It all depends on the type of loan that it is. They're table funded loans, they're warehouse funded loans. But the banks do not lend you their money. Right? The banks cannot lend you their money. Go to title 15, everybody. If the banks cannot lend you their money, the banks cannot lend you depositor money. The banks can't lend any money. They extend you a line of credit and that's what happens. Okay? They extend you a line of credit based on your third party FICO score, your dti, your debt to income ratio and your net worth. Okay? So yes, a loan is created based on that credit. But they don't.
Physically write you a check.
It doesn't happen. I haven't seen it happen. If you look up that Rivers case in Minnesota, which is, it's actually banned right now from being cited because so many people have. Oh yeah, I can send you all the docs. Yeah. If you cite it in your legal pleading, they can cite you and find you. But the Rivers case is the Minnesota case where the homeowner put the bank president on the stand and got the bank president to say I did not loan you any money. Is.
That a clip I might have seen? There's a clip on YouTube.
Yes.
