Paulson Says He Pressured Bank of America CEO

[Appaholic]

Former Treasury secretary Paulson says he was justified in threatening bank CEO's job

WASHINGTON (AP) -- Former Treasury Secretary Henry Paulson says he pressured Bank of America last year to go through with its plans to buy Merrill Lynch but didn't tell the bank's chief to hide losses from shareholders.

In testimony Thursday before the House Oversight and Government Reform Committee, Paulson said he told Bank of America Corp. CEO Kenneth Lewis that the Federal Reserve could fire him if he backed out on the deal.

Paulson said that had the deal collapsed, it would have hurt the bank's stockholders as well as the broader financial system. The government ultimately gave $20 billion to the bank to blunt losses tied to the acquisition.

http://finance.yahoo.com/news/Paulson-s ... et=&ccode=

That's convenient....sure it had nothing to do with bailing out Paulson's good friend and former no.2 at Goldman Sachs, John Thain....

[ASUG8]

TARP's doing great things for us. Just got off the phone with BofA - the investment property we bought 4 yrs ago that BofA happily financed is no longer eligible to be financed by BofA. They don't finance land purchases, so they advised me to use a small credit union or local bank to refi.

[AshevilleApp]

TARP's doing great things for us. Just got off the phone with BofA - the investment property we bought 4 yrs ago that BofA happily financed is no longer eligible to be financed by BofA. They don't finance land purchases, so they advised me to use a small credit union or local bank to refi.

Let me get this straight. A bank can finance a purchase several years prior and then tell you after the fact that the financing is voided?

[ASUMountaineer]

TARP's doing great things for us. Just got off the phone with BofA - the investment property we bought 4 yrs ago that BofA happily financed is no longer eligible to be financed by BofA. They don't finance land purchases, so they advised me to use a small credit union or local bank to refi.

Let me get this straight. A bank can finance a purchase several years prior and then tell you after the fact that the financing is voided?

My guess is it was a short term fix with a balloon (unless you refinance). When I worked at SunTrust, that's how our land loans worked. It was a 3 year fixed rate loan (secured by the land) with a balloon after 3 years--unless we would refinance it for you (never saw it happen) or you improved the land (basically built something on it) and it would be a 12 year loan (15 total counting the first 3). I never sold one of these because they weren't very appealing when a smaller bank/ CU could finance land longer term. I usually advised using your HELOC or HELoan if available as you immediately got the deed and the rate was most likely lower.

[ASUG8]

In our case, the market was booming, we caught it on the way up as an investment and BofA advised us to only do interest only since we'd likely flip it within the 5 yr window. The problem now is the property is likely worth less than we paid, we have to refi within the next year, and because of the changed landscape BofA no longer does this type of loan on undeveloped land for investment purposes. Now I just have to find someone who is interested in doing it, but I'm blaming it on TARP

Typical G8 investment philosophy - buy high, sell low.

[ASUG8]

TARP's doing great things for us. Just got off the phone with BofA - the investment property we bought 4 yrs ago that BofA happily financed is no longer eligible to be financed by BofA. They don't finance land purchases, so they advised me to use a small credit union or local bank to refi.

Let me get this straight. A bank can finance a purchase several years prior and then tell you after the fact that the financing is voided?

No, we always knew it was a fixed 5 yr. interest only loan and we'd either sell it first or refi at the end. I just thought at the time we'd go through BofA again, but it's not going to happen it appears.

[AZGrizFan]

In our case, the market was booming, we caught it on the way up as an investment and BofA advised us to only do interest only since we'd likely flip it within the 5 yr window. The problem now is the property is likely worth less than we paid, we have to refi within the next year, and because of the changed landscape BofA no longer does this type of loan on undeveloped land for investment purposes. Now I just have to find someone who is interested in doing it, but I'm blaming it on TARP

Typical G8 investment philosophy - buy high, sell low.

Good luck finding someone willing to refinance a deal in which you're under water.

[ASUMountaineer]

In our case, the market was booming, we caught it on the way up as an investment and BofA advised us to only do interest only since we'd likely flip it within the 5 yr window. The problem now is the property is likely worth less than we paid, we have to refi within the next year, and because of the changed landscape BofA no longer does this type of loan on undeveloped land for investment purposes. Now I just have to find someone who is interested in doing it, but I'm blaming it on TARP

Typical G8 investment philosophy - buy high, sell low.

Ahh, good ol interest only. Yeah, banks have different products...but it's sort of the same in that it's a short term loan for big purchase with a high risk. I'm not shocked they stopped doing those types of loans on land. It's just not that profitable long run because land that isn't improved/ developed doesn't appreciate quickly enough. However, hopefully they provided you with other choices besides that interest only option. I would seriously contact a small bank of credit union and check out their options, or (if possible) use the equity in your residence.

Guess AZ won't be able to help you out.

[ASUG8]

In our case, the market was booming, we caught it on the way up as an investment and BofA advised us to only do interest only since we'd likely flip it within the 5 yr window. The problem now is the property is likely worth less than we paid, we have to refi within the next year, and because of the changed landscape BofA no longer does this type of loan on undeveloped land for investment purposes. Now I just have to find someone who is interested in doing it, but I'm blaming it on TARP

Typical G8 investment philosophy - buy high, sell low.

Good luck finding someone willing to refinance a deal in which you're under water.

It may not be terribly underwater, I just don't really know. I have a call in to a local bank there to see what they can do, otherwise it's a very expensive lesson to learn. It's on a golf course just over the NC/SC state line about :20 from Myrtle Beach and :40 from Wilmington if anyone's interested.