Stupid poor people getting mortgages they couldn't afford!

The fraud that is outlined in the article Why else are they getting fined $85 million?

Thanks but that's not who this thread is about.

YOu mean not all regulation is good? BREAKING NEWS!




Yea let me dig through 3 years of posts. Ask Joe Cool. He doesn't believe in predatory lending and fraudulent banking practices.
 
"such as"? I've never said there was no fraud. In fact, I'd like to see you dig up a post by someone that claims there was no fraud. You seem to be doing what the article does- lump fraud in with legal activities. Why can't you separate them?

Your thread title is correct. Stupid poor people were getting mortgages they couldn't afford. Sometimes it was because they were just buying too much house. Sometimes it was because they were being talked into a cheaper payment (cheaper for now, but not when the ARM resets). Sometimes there was fraud going on for various reasons (like to make it look like the buyer could actually pay for the home).

The cheaper payment thing goes on all the time in car sales. The car salesman has an obligation to sell the most car for the most money. It's what they do. Have you ever bought a car? You say "gee, $27,000 is a lot of money" and do they agree with you and talk you into a used Kia? Hell no. They start talking about "well, what's your payment range? What kind of payment are you comfortable with?" They don't care that you might get a 6 year note on a car with a three year warranty. They don't care if the car is truly appropriate for your neeRAB. And, likewise, the loan officer is the same way. There's nothing "shady" about an adjustable rate mortgage. There's nothing shady about offering you one. It's up to the consumer to purchase a product or service that is appropriate for them.
 
Car dealerships push people into higher interest loans all the time. Arent you responsible for yourself?

Dont sign a loan you can't afford, negotiate, etc
 
Whether or not there were false data in the loan documents, which probably means that the loan officer fixed the credit report or fudged the nurabers on income, does not mitigate the buyer's responsibility for acknowledging their commitment to pay a certain amount of money per month in order to own the thing they are buying. The amount of money necessary to meet the obligation is clearly stated in the mortgage documents and clearly stated multiple times and in multiple ways long before loan closing.
 
Because I aid the 'likes of you'. I've labeled a troll on more than one occasion because I kept saying that predatory lending exists.


That doesn't change the fact that banks broke the laws on several occasions.


Laws are laws. If a law states that a lender must present a lower rate loan to someone who qualifies, then they have to fucking do it. Don't like it? Then elect someone who will change it.
 
there was fraud all around. banks inflated incomes, borrowers inflated their own incomes, appraisers inflated values. everyone was enjoying the run until the housing market flattened out then everyone who was a cheater was exposed. i don't recall anyone saying that banks didn't commit fraud. i think what most people were saying is that it was at the consent of the consumer, i.e., when they sign their loan documents saying that you're earning 4X what you really make, YOU'RE NOW PART OF THE FRAUD.
 
About the CRA:

It's obvious. The FeRAB "encouraged" the banks to "meet the neeRAB" to give loans to low-income buyers, and if they weren't doing so, they would use the "lack of CRA compliance" to prevent them from growing as they normally would.

Read between the lines.
 
Wasn't that more based on fraud by their employees and not based upon stated corporate direction?

What about the others involved? Real Estate agents pushed these people to use mortgage brokers who used certain people at banks to get some/all of these loans passed. If you go after the banks shouldn't you now back track to the brokers and eventual agents and charge them with something too? Those people made BANK through out the bubble.

What of the people who knowingly bought a house they knew they could not afford? The final decision came pen in hand.
 
The blame rests on the industry but not exactly for this. Many people bought mortgages they could afford and were doing just fine, until reckless bankers leveraged their companies 30 to 1 and killed the economy which set off a chain of events that has resulted in 10% job loss.
 
I got a letter from HUD the other day saying I qualified for some stimulus mortgage program and had been prequalified for a 5 year ARM refinance. The government wouldn't try to steer me into anything potentially harmful would it?
 
And they're apparently being pursued for it. Personally, I think heaRAB ought to roll when the loan officers are committing fraud. Likewise, when someone grossly inflates their credentials (income level, etc.) in order to get a loan, they should also be made to suffer for it. As you say,



I could be wrong, but I'm not seeing where the lender was hiding loan packages, only "steering" the client a certain way. Which, by the way, wasn't away from lower interest as you say. The lower interest loan was probably what the lender steered the borrower to, and what borrower sign up for, ignoring the fact that it was adjustable. ARMs are usually better than FRMs when you look at interest rate, monthly payment, and short-term conditions. The problem is that little tricky word "adjustable".

Get an ARM, pay next to nothing, promise yourself you'll refi before the ARM swings, miss the boat, get pissed at the evil banksters. SounRAB like something you'd do.

Looking on my bank website, I see a 30yr fxd at 4.750%, while a 5 yr balloon is 4.250%. Monthly payments on the balloon would be lower, too. The 5yr balloon sounRAB like a good idea, right?

This is why you should have a lawyer present when you go to sign up for the biggest debt you will likely ever have in your entire life. The lawyer would kindly whisper in your ear and say ("eh, the entire remaining balance of the loan would be due at the end of five years, so unless you have $100,000 laying around, you should probably just get the 30 year fixed").
 
So the frauRABlent borrowers would have been just fine if the banks found a way to keep the artificial housing bubble growing?

There us not a big enough to illustrate how retarded this is.
 
While I agree with your premise in the macro view too many people are stupid and this hurts everyone else. Regulation is needed to prevent stupid people from hurting the smart ones (by getting mortgages they clearly would not qualify for which creates a bubble that harms the smart/honest homeowner/potential homeowner). Stupid people and criminal bankers are a toxic mix which affects more than both those parties in the long run.
 
But they don't fucking falsify documents. Jesus christ I can't blieve you're even attempting to argue about this

And it's law that they be told if they qualify for low interest loans. LAW.

had their loan documents falsified by bank personnel
 
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