Skip to comments.Have lying mortgage bankers met their match?
Posted on 05/05/2011 7:44:03 AM PDT by Chunga85
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During the S&L crisis, hundreds of people were charged with crimes for their fraudulent practices. So far in this "financial meltdown," I'm not aware of any criminal referrals for any fraud or theft. The banksters just collected the taxpayer money and went on with their business.
Looks like they are about to get swept-up in a Populist wave that may result in televised public floggings live from Yankee Stadium.
The problem is, no one wants to point out the folks who are the real culprits: the idiot borrowers who agreed to 2,3,4,500 thousand dollar mortgages they knew they would not or could not pay back.
A mortgage closing takes and hour and you have to sign about 100 documents — all of which say the same thing: make the damned payments.
Why we want to let these folks off the hook is beyond me. Especially Freepers who want to let them off the hook.....
I think the banker and borrowers both should go to jail for fraud. Remember, after the banker consumated the deal, he sold the note to investors, pension funds, etc, etc as AAA rated products. Worst they claimed to physically own the note and title to the property. All written on a prospectus and signed off by the CEO of the bank. Guess what? According to SEC that is fraud. Bankers and borrowers need to face a judge and jury. It is starting to happen. Banks and borrowers are going to end up like tobacco companies, a decade of lawsuits. Atleast the cigarette companies were selling a legal product with known side effects. Bankers were selling fraud.
That wasn't the banks money they were lending out, by way of the Federal insurance, that was your and my money they gave out. The bankers had a fiscal responsibility that they failed to uphold, and they should be held to account.
“Why we want to let these folks off the hook is beyond me. Especially Freepers who want to let them off the hook.....”
There’s a fair amount of blame to go around, but I don’t put stupid consumers at the top of the list.
At the top of my list are the people who put together derivatives, and credit default swaps. The people who sold “toxic assets” knowing they weren’t worth spit, but doing all they could to get them off their own books. When the bubble burst a lot of pension funds, mutual funds, and 401k’s took a big loss.
Next are the mortgage bankers. I know, I know, caveat emptor, right? Well, back in the day, the bankers would make sure you could pay. They had formulas for your debt load and the mortgage payment, and if you didn’t meet the standards, no loan. In fact, the consumer could rely on banker’s approval as a measure of their ability to pay. Predatory banking was a new twist. Taking advantage of ill informed people may be legal, but it’s far from ethical. And it’s bad business. It establishes the bankers as adversaries, not allies.
Finally, at the bottom, I put stupid consumers. Yes, it’s the consumer’s responsibility to be as informed as possible. But trust me, in those closing sessions, the papers come fast and furious, and the summary by the banker is trivialized to the point of being useless. So, the consumer needs to either be experienced, or take a full day to read all that’s shoved their way, or have a lawyer at closing. I don’t give the consumer a pass, but I can understand how a first time buyer can get snookered. There are also those who speculated, bought more than they could afford, knowingly. Those people are just as bad as predatory lenders.
Just my 2 cents, since this is the place to spend it.
Not sure who here wants to let the wall street component off the hook, but there is a total lack of holding dumb (or fraudulent) borrowers to account too. That was my point.
And the lending component became totally estranged from the packaging of the credit default swaps and the other esoteric instruments packaged by banks.
Simply trying to get some proportion in the debate. The media acts like folks who BORROW FOUR HUNDRED THOUSAND and allowed to live in a huge house were somehow “held up” — it makes no sense.
There are an army of foreclosure lawyers going after the failed borrowers, and lots of empty homes. In some states, those folks are still on the hook for the money the bank can't get from the sale of the house. The failed borrowers are not having a fun time. You can find a number of articles on www.nakedcapitalism.com about folks who were robbed of their homes by the banks.
On the other side, we have seen sworn testimony about 10s of thousands of perjured documents by the banks. And yet, no banker has lost his house or been otherwise penalized.
Until we see a lot of perp walks, there isn't enough emphasis on the crime of the bankers.
You have bought all of the liberal populist victimology kool aid on this story and understand NOTHING about the mortgage industry.
I’ve not the time to educate you on how it works.
Please reconsider. Your country needs you now.
Were we to hold court with the issue at bar being our survival in imaginary case "Citizens [Plaintiff] v. America, Inc. [Defendant]" the defense would move the court to dismiss.
The Plaintiff could adequately plead the necessary elements of negligent misrepresentation in order to defeat a motion to dismiss.
Defendants would offer no valid case law to support their position because there is none.
The court would rule in favor of the defendants based on economics as opposed to law.
Yeah, da heck with holding the banks responsible for their shady business practices, or letting them face the risk they accepted. Not to mention ignoring the laws they broke.
bwahhhaa haahhhhaaaaa haahaaa
thanks for the laugh
It's not about the victimology of the borrower. It's about the criminality of the lenders, which is on all sides of the deal. The bankers & mortgage processors have shafted the borrowers, and the taxpayers who guaranteed the loans, and the pension plans that bought the loans via MBS.
And the banks did this intentionally.
Stupid, venal and corrupt borrowers are and have always been a problem and banks were supposed to exercise their fiduciary responsibility on behalf of the shareholders and despositors to not lend to these types of borrowers. What's new now is the flagrant disregard of the banking and mortgage industry in giving out huge money to this type of borrower.
Stupid, venal and corrupt borrowers aren't a problem if the banks properly refuse to lend to them.
What a child. You want to hold the business responsible but not the borrower - when in fact if the borrower had simply lived up to their obligation there would be no problem.
You have your ACORN membership with you? Or did you leave it at the unemployment office? Maybe in the government cheese line? Oh, i know, it’s under our work boots where you’ll NEVER find it.
“What a child. “
Thanks for the personal attack.
“You want to hold the business responsible but not the borrower -”
Where did I say that?
“when in fact if the borrower had simply lived up to their obligation there would be no problem.”
No problem with the banks committing fraud, perjury and a myriad of other crimes? Which bank do you work for?
I don’t work for a bank.
But I do have four mortgages. I understand them all. I pay them all. I accept responsiblity for them all.
You, meanwhile, agree with CNN.
The issue is not the forclosure, even with the document fraud.
The issue is the questionable ability of the mortgage holder to convey clear title to the new owners without the proper paperwork (which they cannot produce) because of MERS.
Can of worms and it is already opened. What a mess. Will take years to solve and there is no universal quick fix. Only case by case solution.
If you want to deny that the government under Carter and then Clinton forced banks to lend to folks they did not want to, then go ahead and join ACORN and the DNC and MSNBC and the Daily Kos and Huff Po and The Nation and all the others who agree with that sentiment.
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