[analyst]

[quote=patientrenter]We will have to agree to disagree, analyst. If I borrow $500,000 from you, then I owe you $500,000. The fact that I choose to use that $500,000 to pay far too much for a shack, or throw it down a well, or plough it into my business, or whatever… is irrelevant in my eyes.[/quote]

Lawmakers in non-recourse jurisdictions observed that sellers, lenders, appraisers, and the real estate sales force, repeatedly, over long periods of time, induced less sophisticated buyer-borrowers to buy homes at inflated prices.

To curtail this practice, the lawmakers passed laws that charged the lenders with responsibility for insuring that the sale (collateral) value of the home would always be equal to or greater than the loan balance. They did this by specifying that the lender could take the home from a defaulting borrower, but could not make a claim against other money or assets of the borrower.

If you borrowed $500,000 from me because I conspired with sellers, appraisers, and real estate salesmen to create the artificial appearance that the home you were looking at was worth $500,000, when all the conspirators knew that it was not, and the home was in a jurisdiction where the lawmakers had decreed that the actual value of the home was the upper limit of your liability, it is clear that you do not owe me $500,000. You owe me the home.

Further, based on the bad acts of the other parties, it is clear that there would not be anything unethical about your decision to resolve the matter by turning the property over to me.

[analyst]

[quote=patientrenter]We will have to agree to disagree, analyst. If I borrow $500,000 from you, then I owe you $500,000. The fact that I choose to use that $500,000 to pay far too much for a shack, or throw it down a well, or plough it into my business, or whatever… is irrelevant in my eyes.[/quote]

Lawmakers in non-recourse jurisdictions observed that sellers, lenders, appraisers, and the real estate sales force, repeatedly, over long periods of time, induced less sophisticated buyer-borrowers to buy homes at inflated prices.

To curtail this practice, the lawmakers passed laws that charged the lenders with responsibility for insuring that the sale (collateral) value of the home would always be equal to or greater than the loan balance. They did this by specifying that the lender could take the home from a defaulting borrower, but could not make a claim against other money or assets of the borrower.

If you borrowed $500,000 from me because I conspired with sellers, appraisers, and real estate salesmen to create the artificial appearance that the home you were looking at was worth $500,000, when all the conspirators knew that it was not, and the home was in a jurisdiction where the lawmakers had decreed that the actual value of the home was the upper limit of your liability, it is clear that you do not owe me $500,000. You owe me the home.

Further, based on the bad acts of the other parties, it is clear that there would not be anything unethical about your decision to resolve the matter by turning the property over to me.

[analyst]

[quote=patientrenter]We will have to agree to disagree, analyst. If I borrow $500,000 from you, then I owe you $500,000. The fact that I choose to use that $500,000 to pay far too much for a shack, or throw it down a well, or plough it into my business, or whatever… is irrelevant in my eyes.[/quote]

Lawmakers in non-recourse jurisdictions observed that sellers, lenders, appraisers, and the real estate sales force, repeatedly, over long periods of time, induced less sophisticated buyer-borrowers to buy homes at inflated prices.

To curtail this practice, the lawmakers passed laws that charged the lenders with responsibility for insuring that the sale (collateral) value of the home would always be equal to or greater than the loan balance. They did this by specifying that the lender could take the home from a defaulting borrower, but could not make a claim against other money or assets of the borrower.

If you borrowed $500,000 from me because I conspired with sellers, appraisers, and real estate salesmen to create the artificial appearance that the home you were looking at was worth $500,000, when all the conspirators knew that it was not, and the home was in a jurisdiction where the lawmakers had decreed that the actual value of the home was the upper limit of your liability, it is clear that you do not owe me $500,000. You owe me the home.

Further, based on the bad acts of the other parties, it is clear that there would not be anything unethical about your decision to resolve the matter by turning the property over to me.

[analyst]

[quote=patientrenter]We will have to agree to disagree, analyst. If I borrow $500,000 from you, then I owe you $500,000. The fact that I choose to use that $500,000 to pay far too much for a shack, or throw it down a well, or plough it into my business, or whatever… is irrelevant in my eyes.[/quote]

Lawmakers in non-recourse jurisdictions observed that sellers, lenders, appraisers, and the real estate sales force, repeatedly, over long periods of time, induced less sophisticated buyer-borrowers to buy homes at inflated prices.

To curtail this practice, the lawmakers passed laws that charged the lenders with responsibility for insuring that the sale (collateral) value of the home would always be equal to or greater than the loan balance. They did this by specifying that the lender could take the home from a defaulting borrower, but could not make a claim against other money or assets of the borrower.

If you borrowed $500,000 from me because I conspired with sellers, appraisers, and real estate salesmen to create the artificial appearance that the home you were looking at was worth $500,000, when all the conspirators knew that it was not, and the home was in a jurisdiction where the lawmakers had decreed that the actual value of the home was the upper limit of your liability, it is clear that you do not owe me $500,000. You owe me the home.

Further, based on the bad acts of the other parties, it is clear that there would not be anything unethical about your decision to resolve the matter by turning the property over to me.

[analyst]

[quote=patientrenter]We will have to agree to disagree, analyst. If I borrow $500,000 from you, then I owe you $500,000. The fact that I choose to use that $500,000 to pay far too much for a shack, or throw it down a well, or plough it into my business, or whatever… is irrelevant in my eyes.[/quote]

Lawmakers in non-recourse jurisdictions observed that sellers, lenders, appraisers, and the real estate sales force, repeatedly, over long periods of time, induced less sophisticated buyer-borrowers to buy homes at inflated prices.

To curtail this practice, the lawmakers passed laws that charged the lenders with responsibility for insuring that the sale (collateral) value of the home would always be equal to or greater than the loan balance. They did this by specifying that the lender could take the home from a defaulting borrower, but could not make a claim against other money or assets of the borrower.

If you borrowed $500,000 from me because I conspired with sellers, appraisers, and real estate salesmen to create the artificial appearance that the home you were looking at was worth $500,000, when all the conspirators knew that it was not, and the home was in a jurisdiction where the lawmakers had decreed that the actual value of the home was the upper limit of your liability, it is clear that you do not owe me $500,000. You owe me the home.

Further, based on the bad acts of the other parties, it is clear that there would not be anything unethical about your decision to resolve the matter by turning the property over to me.

[analyst]

[quote=patientrenter]analyst, when I read your argument, what I see is, to paraphrase: “Those people over there guarding the gold at Fort Leavenworth left the door open. Other people are stealing the gold. Let’s blame the people who left the door open, and not assign any blame or responsibility on the people who stole the gold. Hell, they hardly even stole it, because whenever you see a door open, everything inside is yours for the taking.”

I’m sure it’s not how you see it. But it sure is very convenient to pretend that only the guardians of the gate are responsible, and those who take advantage of the unguarded gate are blameless.

By the way, TG, I think your writing style, and even just your style of arguing and dealing with others, is remarkable. I hope you’re being paid a lot for what you do at work. I know a lot of people in the industry I work in who appear less capable, and who are making over $500K/yr, or even over $1 mill/yr.[/quote]

Your analogy does not accurately describe the situation.

The borrower does not get any “gold”. Most of it went to the people from whom the borrower bought the home. The lender who arranged the deal took a portion of gold and kept it.

When the lenders were lending money for which they remained responsible, they were “guardians”. When they began selling their loans into clearly misrepresented mortgage-backed securities pools, they became active co-conspirators in a criminal enterprise designed to misappropriate a portion of investor “gold” by inducing the investors to participate in a Ponzi scheme.

Ultimately, the borrower also does not get to keep the home. I do not argue that they are blameless, only that they are minor players in the cause and cure of the problem, and that people are wasting their time and mental energy focusing on them, while the real cause and cure is not being properly addressed.

[analyst]

[quote=patientrenter]analyst, when I read your argument, what I see is, to paraphrase: “Those people over there guarding the gold at Fort Leavenworth left the door open. Other people are stealing the gold. Let’s blame the people who left the door open, and not assign any blame or responsibility on the people who stole the gold. Hell, they hardly even stole it, because whenever you see a door open, everything inside is yours for the taking.”

I’m sure it’s not how you see it. But it sure is very convenient to pretend that only the guardians of the gate are responsible, and those who take advantage of the unguarded gate are blameless.

By the way, TG, I think your writing style, and even just your style of arguing and dealing with others, is remarkable. I hope you’re being paid a lot for what you do at work. I know a lot of people in the industry I work in who appear less capable, and who are making over $500K/yr, or even over $1 mill/yr.[/quote]

Your analogy does not accurately describe the situation.

The borrower does not get any “gold”. Most of it went to the people from whom the borrower bought the home. The lender who arranged the deal took a portion of gold and kept it.

When the lenders were lending money for which they remained responsible, they were “guardians”. When they began selling their loans into clearly misrepresented mortgage-backed securities pools, they became active co-conspirators in a criminal enterprise designed to misappropriate a portion of investor “gold” by inducing the investors to participate in a Ponzi scheme.

Ultimately, the borrower also does not get to keep the home. I do not argue that they are blameless, only that they are minor players in the cause and cure of the problem, and that people are wasting their time and mental energy focusing on them, while the real cause and cure is not being properly addressed.

[analyst]

[quote=patientrenter]analyst, when I read your argument, what I see is, to paraphrase: “Those people over there guarding the gold at Fort Leavenworth left the door open. Other people are stealing the gold. Let’s blame the people who left the door open, and not assign any blame or responsibility on the people who stole the gold. Hell, they hardly even stole it, because whenever you see a door open, everything inside is yours for the taking.”

I’m sure it’s not how you see it. But it sure is very convenient to pretend that only the guardians of the gate are responsible, and those who take advantage of the unguarded gate are blameless.

By the way, TG, I think your writing style, and even just your style of arguing and dealing with others, is remarkable. I hope you’re being paid a lot for what you do at work. I know a lot of people in the industry I work in who appear less capable, and who are making over $500K/yr, or even over $1 mill/yr.[/quote]

Your analogy does not accurately describe the situation.

The borrower does not get any “gold”. Most of it went to the people from whom the borrower bought the home. The lender who arranged the deal took a portion of gold and kept it.

When the lenders were lending money for which they remained responsible, they were “guardians”. When they began selling their loans into clearly misrepresented mortgage-backed securities pools, they became active co-conspirators in a criminal enterprise designed to misappropriate a portion of investor “gold” by inducing the investors to participate in a Ponzi scheme.

Ultimately, the borrower also does not get to keep the home. I do not argue that they are blameless, only that they are minor players in the cause and cure of the problem, and that people are wasting their time and mental energy focusing on them, while the real cause and cure is not being properly addressed.

[analyst]

[quote=patientrenter]analyst, when I read your argument, what I see is, to paraphrase: “Those people over there guarding the gold at Fort Leavenworth left the door open. Other people are stealing the gold. Let’s blame the people who left the door open, and not assign any blame or responsibility on the people who stole the gold. Hell, they hardly even stole it, because whenever you see a door open, everything inside is yours for the taking.”

I’m sure it’s not how you see it. But it sure is very convenient to pretend that only the guardians of the gate are responsible, and those who take advantage of the unguarded gate are blameless.

By the way, TG, I think your writing style, and even just your style of arguing and dealing with others, is remarkable. I hope you’re being paid a lot for what you do at work. I know a lot of people in the industry I work in who appear less capable, and who are making over $500K/yr, or even over $1 mill/yr.[/quote]

Your analogy does not accurately describe the situation.

The borrower does not get any “gold”. Most of it went to the people from whom the borrower bought the home. The lender who arranged the deal took a portion of gold and kept it.

When the lenders were lending money for which they remained responsible, they were “guardians”. When they began selling their loans into clearly misrepresented mortgage-backed securities pools, they became active co-conspirators in a criminal enterprise designed to misappropriate a portion of investor “gold” by inducing the investors to participate in a Ponzi scheme.

Ultimately, the borrower also does not get to keep the home. I do not argue that they are blameless, only that they are minor players in the cause and cure of the problem, and that people are wasting their time and mental energy focusing on them, while the real cause and cure is not being properly addressed.

[analyst]

[quote=patientrenter]analyst, when I read your argument, what I see is, to paraphrase: “Those people over there guarding the gold at Fort Leavenworth left the door open. Other people are stealing the gold. Let’s blame the people who left the door open, and not assign any blame or responsibility on the people who stole the gold. Hell, they hardly even stole it, because whenever you see a door open, everything inside is yours for the taking.”

I’m sure it’s not how you see it. But it sure is very convenient to pretend that only the guardians of the gate are responsible, and those who take advantage of the unguarded gate are blameless.

By the way, TG, I think your writing style, and even just your style of arguing and dealing with others, is remarkable. I hope you’re being paid a lot for what you do at work. I know a lot of people in the industry I work in who appear less capable, and who are making over $500K/yr, or even over $1 mill/yr.[/quote]

Your analogy does not accurately describe the situation.

The borrower does not get any “gold”. Most of it went to the people from whom the borrower bought the home. The lender who arranged the deal took a portion of gold and kept it.

When the lenders were lending money for which they remained responsible, they were “guardians”. When they began selling their loans into clearly misrepresented mortgage-backed securities pools, they became active co-conspirators in a criminal enterprise designed to misappropriate a portion of investor “gold” by inducing the investors to participate in a Ponzi scheme.

Ultimately, the borrower also does not get to keep the home. I do not argue that they are blameless, only that they are minor players in the cause and cure of the problem, and that people are wasting their time and mental energy focusing on them, while the real cause and cure is not being properly addressed.

[analyst]

It appears that the most important thought is not getting through to some.

When you look at a situation and observe ten categories of participants, who have all done wrong, you should not spend your time and mental energy addressing the actions of the minor players. Without the wrong-doing of the financial institutions and the inaction (some would say collusion) of the government and appointed regulators, dishonest borrowers would have zero impact on your life and finances.

The time and mental energy spent addressing the sins of the little players would be better spent addressing the sins of the big players, who were and are taking every opportunity to defraud investors and/or loot the U. S. Treasury, effectively stealing from you and I, the taxpayers. That is the undeserved gain to focus on, not the fact that some upside-down borrowers are failing to repay their loans, or benefitting from a free-rent situation.

Worry less about the borrowers, and more about the big picture. If the primary perpetrators are not reined in, they will continue causing further great harm.

[analyst]

It appears that the most important thought is not getting through to some.

When you look at a situation and observe ten categories of participants, who have all done wrong, you should not spend your time and mental energy addressing the actions of the minor players. Without the wrong-doing of the financial institutions and the inaction (some would say collusion) of the government and appointed regulators, dishonest borrowers would have zero impact on your life and finances.

The time and mental energy spent addressing the sins of the little players would be better spent addressing the sins of the big players, who were and are taking every opportunity to defraud investors and/or loot the U. S. Treasury, effectively stealing from you and I, the taxpayers. That is the undeserved gain to focus on, not the fact that some upside-down borrowers are failing to repay their loans, or benefitting from a free-rent situation.

Worry less about the borrowers, and more about the big picture. If the primary perpetrators are not reined in, they will continue causing further great harm.

[analyst]

It appears that the most important thought is not getting through to some.

When you look at a situation and observe ten categories of participants, who have all done wrong, you should not spend your time and mental energy addressing the actions of the minor players. Without the wrong-doing of the financial institutions and the inaction (some would say collusion) of the government and appointed regulators, dishonest borrowers would have zero impact on your life and finances.

The time and mental energy spent addressing the sins of the little players would be better spent addressing the sins of the big players, who were and are taking every opportunity to defraud investors and/or loot the U. S. Treasury, effectively stealing from you and I, the taxpayers. That is the undeserved gain to focus on, not the fact that some upside-down borrowers are failing to repay their loans, or benefitting from a free-rent situation.

Worry less about the borrowers, and more about the big picture. If the primary perpetrators are not reined in, they will continue causing further great harm.

[analyst]

It appears that the most important thought is not getting through to some.

When you look at a situation and observe ten categories of participants, who have all done wrong, you should not spend your time and mental energy addressing the actions of the minor players. Without the wrong-doing of the financial institutions and the inaction (some would say collusion) of the government and appointed regulators, dishonest borrowers would have zero impact on your life and finances.

The time and mental energy spent addressing the sins of the little players would be better spent addressing the sins of the big players, who were and are taking every opportunity to defraud investors and/or loot the U. S. Treasury, effectively stealing from you and I, the taxpayers. That is the undeserved gain to focus on, not the fact that some upside-down borrowers are failing to repay their loans, or benefitting from a free-rent situation.

Worry less about the borrowers, and more about the big picture. If the primary perpetrators are not reined in, they will continue causing further great harm.

[analyst]

It appears that the most important thought is not getting through to some.

When you look at a situation and observe ten categories of participants, who have all done wrong, you should not spend your time and mental energy addressing the actions of the minor players. Without the wrong-doing of the financial institutions and the inaction (some would say collusion) of the government and appointed regulators, dishonest borrowers would have zero impact on your life and finances.

The time and mental energy spent addressing the sins of the little players would be better spent addressing the sins of the big players, who were and are taking every opportunity to defraud investors and/or loot the U. S. Treasury, effectively stealing from you and I, the taxpayers. That is the undeserved gain to focus on, not the fact that some upside-down borrowers are failing to repay their loans, or benefitting from a free-rent situation.

Worry less about the borrowers, and more about the big picture. If the primary perpetrators are not reined in, they will continue causing further great harm.

[Author]

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