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Culprits behind mortgage debacle!!


Putty

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"By 2005, 38% of World's clients had subprime credit scores. And customers were shown fliers that told them their income would not be checked by the bank.

 

"So I don't really need to know what you make. I don't need proof. You tell me you make $200,000 a year? You make $200,000 a year," Bishop said.

 

"No verification?" Pelley asked.

 

"Not gonna check," Bishop replied.

 

Asked how many loans would be covered in a single day, Bishop said, "80, 90, we would keep track of it. 80, 90, 100 would be reviewed, yeah. Oh, yeah."

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So I agree whole-heartedly that these banks were screwed up, and it is their fault... but... I love how the people getting the loans are look on as just innocent bystanders in all of this, like they deserve to be helped. If I am Joe Blow making $35k a year, and I tell a bank I make $200k so that I can get a loan, aren't I just as liable as they are? Am I so wrong in thinking that NO ONE deserves any help here?
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So I agree whole-heartedly that these banks were screwed up, and it is their fault... but... I love how the people getting the loans are look on as just innocent bystanders in all of this, like they deserve to be helped. If I am Joe Blow making $35k a year, and I tell a bank I make $200k so that I can get a loan, aren't I just as liable as they are? Am I so wrong in thinking that NO ONE deserves any help here?

 

Agreed, however the ones I still kinda' feel for are the ones that went into it completely ignorant and let someone convince them they can afford a house 3x more than they can. I saw lots of people I know fall into that trap, even the ones I thought knew better.

 

It's amazing to me that there were lenders basically telling people "Sure, you're a cashier at WalMart but you can afford a 250k house because you have good enough credit to get the loan - we wouldn't loan you money you can't pay back... would we?" for years before they started getting in trouble for predatory lending.

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It's amazing to me that there were lenders basically telling people "Sure, you're a cashier at WalMart but you can afford a 250k house because you have good enough credit to get the loan - we wouldn't loan you money you can't pay back... would we?" for years before they started getting in trouble for predatory lending.

 

According to the show...they had a "Pick a payment" option when those people were getting loans. There were like 5 to choose from. Low to high, 1 to 5. The 1st was like $1100 a month to like $1700 a month. Most people selected #1 which was not even enough to cover the interest a month...Dude said that shit was compounding like crazy and then BOOM! payment explodes! I blame both people equally, lender and borrower.

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this is a good example of the tactics that were being used just about everywhere to bait consumers. Was what they did wrong? YES....however it still takes 2 to tango and the consumers that either lied about things on their apps or bought a house WAY above what they could afford are liable as well.

 

I think the very root of the problem stems from the complete lack of loyalty between companies and employees within the current workforce (or more or less that people are assholes). Joe-blow mortgage broker knows/feels that his company doesn't care about him, but they pay him more for more volume. He doesn't give a flying-F about his customers so he does everything he can to jam them up and make himself as much money as possible. Same thing happened farther up the line. People knew that it wasn't good for the company but didn't care cause it was better for their paychecks....after years of that attitude something had to finally give.

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I blame Bill Clinton. That administration drafted some of the most fucked up backward legislation that basically allowed anyone who wanted a house to obtain one. People are to blame too, greedy fucking consumers. Thirdly, I blame the builders, the people who cranked out neighborhoods of these cookie cutter homes. Since that started happening, supply has gone through the roof. Its no wonder we have a 20 month housing surplus.

 

I cant afford a house right now, so you know what I do? I stay my ass out of the market.

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Agreed, however the ones I still kinda' feel for are the ones that went into it completely ignorant and let someone convince them they can afford a house 3x more than they can. I saw lots of people I know fall into that trap, even the ones I thought knew better.

 

It's amazing to me that there were lenders basically telling people "Sure, you're a cashier at WalMart but you can afford a 250k house because you have good enough credit to get the loan - we wouldn't loan you money you can't pay back... would we?" for years before they started getting in trouble for predatory lending.

But, if you are ignorant, who's fault is it? If I shit in a bag, draft up a document saying exactly what it is, and sell it to someone for $50 after they sign said document, am I at fault?

 

I'm tired of consumers getting a free pass using the "well I didn't know any better" excuse. If I have a business, I should be able to do WHATEVER I want, within the confines of the law, to make as much money as possible. It's just like the payday lending bill that passed. Who is the government to tell a business what is an OK interest rate? If it is too high and unfair, then no one will take the loan. If there is a market, then a business should be allowed to maximize their profit. At what point does the president step in and tell McDonalds that their quarter pounder costs too much?

 

Of course, I do understand that in the case of these loans, there is also a responsibility of the lender to make loans that they know will get paid back. In that case, I think that if a business makes bad loans that are defaulted, too bad so sad, your business is going to fail. All of the government crap stepping in is BS... that goes for the government programs enstated by Clinton, or whoever, as well as their involvement bailing shit out.

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