Housing Foreclosure Story-Who pays the price for greed and dishonesty?

[KamFongasChinHo]

From today’s WSJ.com. It really exemplifies how stupid the banks were to give people loans with no money down. If the property value goes down the bank loses. If the property value goes up, the bank makes a fraction of what the homeowner makes. I’m really sick and tired of all the whining from people who made stupid decisions to get rich and buy homes they couldn’t afford.

http://tinyurl.com/58rpcn

The World’s Smallest Violin
The Los Angeles Times reports from Santa Maria, Calif., on the tragic story of Patricia Prado:

Property values in this Central Coast farm town had been rising sharply, and Prado and her husband were burdened by $18,000 in debt from their credit cards and the loan on their Jeep Grand Cherokee.

Prado remembers expressing worry about her situation to co-workers at the food processing plant where she works. A few days later, she got a phone call from a mortgage broker who said she had heard her tale and had a solution: a mortgage loan that required no money down.

“She made everything sound like it was going to be wonderful,” said Prado, 38.

A few weeks later, Prado bought a $412,000 house with a so-called 80/20 mortgage. Those mortgages are actually a pair of loans–one for 80% of the purchase price and another for the remaining 20%.

Of course you know what happened: Home values dropped, so the Prados ended up owing more money than their house was worth. They couldn’t make the payments and ultimately lost the place to foreclosure.

The story is headlined “Hard Lessons on Getting Home Loans With No Money Down,” and the Times reporter does his best to portray Mrs. Prado as a victim, but she doesn’t cooperate:

Prado tells her story without a trace of self-pity and only a bit of blame for the mortgage broker who she says gave her a hard sell.

She acknowledged that she stated her monthly income as $7,500 on the loan application–nearly double what she was actually earning in her job as a clerk at a food processing company and a second part-time job. . . .

Financially, Prado says she hasn’t really lost anything, since she put no money down to get her mortgage.

She got the loan under false pretenses, and if her timing had been better–that is, if she had bought the house a few years earlier–she would have benefited from rising prices without putting any of her own money at risk. In a just world, people would pay a higher price for greed and dishonesty.

[gdcox]

This is mortgage fraud.

She should be charged and jailed.

You cannot blame banks when the applicant and broker collude to lie about income, but you can blame those in charge who don’t bother wielding the stick.

The fact that she freely talks of it shows how much morality/respect for law is left these days.

Arnie talks tough but……….

It could be argued that it is dishonest citizens who present the main threat to the health of the USA; not Iranians.

[gdcox]

This is mortgage fraud.

She should be charged and jailed.

You cannot blame banks when the applicant and broker collude to lie about income, but you can blame those in charge who don’t bother wielding the stick.

The fact that she freely talks of it shows how much morality/respect for law is left these days.

Arnie talks tough but……….

It could be argued that it is dishonest citizens who present the main threat to the health of the USA; not Iranians.

[gdcox]

This is mortgage fraud.

She should be charged and jailed.

You cannot blame banks when the applicant and broker collude to lie about income, but you can blame those in charge who don’t bother wielding the stick.

The fact that she freely talks of it shows how much morality/respect for law is left these days.

Arnie talks tough but……….

It could be argued that it is dishonest citizens who present the main threat to the health of the USA; not Iranians.

[gdcox]

This is mortgage fraud.

She should be charged and jailed.

You cannot blame banks when the applicant and broker collude to lie about income, but you can blame those in charge who don’t bother wielding the stick.

The fact that she freely talks of it shows how much morality/respect for law is left these days.

Arnie talks tough but……….

It could be argued that it is dishonest citizens who present the main threat to the health of the USA; not Iranians.

[gdcox]

This is mortgage fraud.

She should be charged and jailed.

You cannot blame banks when the applicant and broker collude to lie about income, but you can blame those in charge who don’t bother wielding the stick.

The fact that she freely talks of it shows how much morality/respect for law is left these days.

Arnie talks tough but……….

It could be argued that it is dishonest citizens who present the main threat to the health of the USA; not Iranians.

[XBoxBoy]

gdcox claims: You cannot blame banks when the applicant and broker collude to lie about income.

If the bank willing turned a blind eye, knowing that they would unload the loan to someone else before it went south, then yes I think the banks deserve just as much blame. It is astonishing to me that banks went along with this whole no-doc thing. What person or business lends out money without verifying that the person is who they say they are, and that they stand a reasonable chance of being repaid?

Also, you say we’ve lost respect for the law and I would say that we’ve never had respect for the law in this country. But what we have lost is respect for honesty, which I do believe we used to have respect for. And that is indeed much more of a threat to the USA than Iranians.

XBoxBoy

[XBoxBoy]

gdcox claims: You cannot blame banks when the applicant and broker collude to lie about income.

If the bank willing turned a blind eye, knowing that they would unload the loan to someone else before it went south, then yes I think the banks deserve just as much blame. It is astonishing to me that banks went along with this whole no-doc thing. What person or business lends out money without verifying that the person is who they say they are, and that they stand a reasonable chance of being repaid?

Also, you say we’ve lost respect for the law and I would say that we’ve never had respect for the law in this country. But what we have lost is respect for honesty, which I do believe we used to have respect for. And that is indeed much more of a threat to the USA than Iranians.

XBoxBoy

[XBoxBoy]

gdcox claims: You cannot blame banks when the applicant and broker collude to lie about income.

If the bank willing turned a blind eye, knowing that they would unload the loan to someone else before it went south, then yes I think the banks deserve just as much blame. It is astonishing to me that banks went along with this whole no-doc thing. What person or business lends out money without verifying that the person is who they say they are, and that they stand a reasonable chance of being repaid?

Also, you say we’ve lost respect for the law and I would say that we’ve never had respect for the law in this country. But what we have lost is respect for honesty, which I do believe we used to have respect for. And that is indeed much more of a threat to the USA than Iranians.

XBoxBoy

[XBoxBoy]

gdcox claims: You cannot blame banks when the applicant and broker collude to lie about income.

If the bank willing turned a blind eye, knowing that they would unload the loan to someone else before it went south, then yes I think the banks deserve just as much blame. It is astonishing to me that banks went along with this whole no-doc thing. What person or business lends out money without verifying that the person is who they say they are, and that they stand a reasonable chance of being repaid?

Also, you say we’ve lost respect for the law and I would say that we’ve never had respect for the law in this country. But what we have lost is respect for honesty, which I do believe we used to have respect for. And that is indeed much more of a threat to the USA than Iranians.

XBoxBoy

[XBoxBoy]

gdcox claims: You cannot blame banks when the applicant and broker collude to lie about income.

If the bank willing turned a blind eye, knowing that they would unload the loan to someone else before it went south, then yes I think the banks deserve just as much blame. It is astonishing to me that banks went along with this whole no-doc thing. What person or business lends out money without verifying that the person is who they say they are, and that they stand a reasonable chance of being repaid?

Also, you say we’ve lost respect for the law and I would say that we’ve never had respect for the law in this country. But what we have lost is respect for honesty, which I do believe we used to have respect for. And that is indeed much more of a threat to the USA than Iranians.

XBoxBoy

[NotCranky]

Why do Iranians come into play here?
Because like all great empires, we have become addicted to solving our problems to a large degree with the influence on world dynamics that power allows for and the spoils of outright war…

[NotCranky]

Why do Iranians come into play here?
Because like all great empires, we have become addicted to solving our problems to a large degree with the influence on world dynamics that power allows for and the spoils of outright war…

[NotCranky]

Why do Iranians come into play here?
Because like all great empires, we have become addicted to solving our problems to a large degree with the influence on world dynamics that power allows for and the spoils of outright war…

[NotCranky]

Why do Iranians come into play here?
Because like all great empires, we have become addicted to solving our problems to a large degree with the influence on world dynamics that power allows for and the spoils of outright war…

[Author]

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