I have little sympathy for the borrowers, but I really had to chuckle at the last few lines, especially this part:

“In short, while the Court found that the Hills knowingly made false representations to the lender, the lender’s claim that it “reasonably relied” on these representations doesn’t hold water, because “stated income guidelines” are not reasonable things to rely on.”

And also this part:
“If you make a “liar loan,” the Judge is saying here, then you cannot claim you were harmed by relying on lies.”

Although I do think the irresponsible and somewhat fradulent borrowers should be made partly responsible somehow too… Maybe by more stringent punishment through the credit history, or maybe by making them liable for the cash they took out.