Given the tendency to a lax nature for Alt-A loans I gather the fraud to be in the income claiming area.
This article and others that find “prime” mortgage holders walking from them before the rates even reset seem to indicate that a lot more people bought homes hoping to make a quick $100 Grand 3 years later when their loans reset and their house doubled in value again.
Thus a speculative bubble.
It will likely all come back to the false income claimed, but I’m interested to see if a judge finds that the borrower signed with the flase amount, or if the broker is found to have changed to amount to get the loan through.