By: MegaCynic

MegaCynic — Thu, 12 May 2011 12:56:15 +0000

To: 2Pirates over 40, So then what you are implying is that mortgage brokers took advantage of the finacially unsophisticated, and they also took advantage of people who were greedy to the point of ignoring the possibility of a housing downturn, people who believed that the constantly increasing value of their home investment would bail them out of any financing arrangment on their real estate investment.

Your comment seems likely. Maybe someone on the defense team can normmalize for all the important variables like eduction, employment history, likelihood of maintainging a job in a deep recession, etc. and demonstrate that mortgage brokers were universal predators and didn’t select victims based upon the vicitms’ skin color, ethnic background, or religeon.

But then again, it does seem that forcing banks and other mortgage lender to do mortgage loans in poverty areas and ghetto areas adds a certain increased risk to those loans.

By: talktotennessee

talktotennessee — Fri, 06 May 2011 18:52:33 +0000

You aren’t from Memphis are you?
Of course you have a point; many vulnerable, Hispanic and poor were also duped into bad loans because a mortgage broker failed to tell them they could qualify for better loans or they trusted their lender/broker ‘friend.’ In Memphis it became a RACE issue. You would have to drive through blighted areas of Memphis and see the abandoned houses and really realize blacks were targeted because the brokers ‘could’ through the encouragement of greedy lenders who had figured out how to get around corporate risk for their companies. They bundled and sold those bad loans, fooliing everyone, right?
Of course these suits are drawn to fit legal criteria so anecdotal reality doesn’t fly.
However, mortgage brokers were getting rich at the time. I knew a broker whose practice it was to repeat refinances. A borrower he had worked with had good income, owned his home many years. I didn’t know for sure but suspected the homeowner had decent credit and could have qualified for a fixed rate loan. The broker put him in an ARM (adjustable rate mortgage) the first time around. When near reset the broker told the borrower he would be ‘wise’ to refinance before the rate reset. The borrower believed his broker was acting in his best interests to save him money, a common myth, when the broker was merely double dipping on broker fees. The broker used his “friend” as an income vehicle, placing him in not one but two predatory ARM loans. Brokers commonly did these refi loans for friends and family. Teaser rates were designed to draw in the borrower with the promise that one could always refinance before a reset. Most were caught out when the bubble burst. The practice was rampant. Remodelers in Memphis hooked up with a lender, set up in poor parts of town, refinanced old houses with a promise to repair them “free” on a ARM, put a dollar or two in the homeowner’s pocket as a bonus..
The elderly, poor, those ignorant of the process in a city with predominant African American population, were targeted and hoodwinked much like a pigeon drop scam; something for nothing. Often repairs were shoddy or minimal.
One could say people were foolish to believe. They should have asked questions and challenged their broker ‘friend.’ One could say they even deserved what they got, loss of their homes in the end. Draw a circle around ignorance and trust.

Have you read how many intelligent, informed, wealthy people bought into Madoff’s schemes?

By: 2 Pirates Over 40

2 Pirates Over 40 — Fri, 06 May 2011 17:16:14 +0000

It really is not a race issue, didn’t Wells Fargo do that to pretty much everyone that got caught up in a loan product destined to go bad ?????????????????/

Comments on: NY Times | Judge Allows Wells Fargo Redlining Suits to Proceed

By: MegaCynic

By: talktotennessee

By: 2 Pirates Over 40