Predatory Liar Loans.

[eric pebble]

PREDATORY LIAR LOANS:

Read this and weep.

"Consider, for instance, the Henriquez family of California's Central Valley, one of 25 Latino families interviewed in detail by researchers from the University of North Carolina Center for Community Capital and the National Council of La Raza for a report examining the impact of foreclosures on families. Mrs. Henriquez described how a real estate agent steered the family into an expensive loan:

[The] real estate agencies [said] we'll come out and it was in Spanish, my language - They said, "We can help you, just go to the house, we'll let you know and soon if you qualify or not." ... We said what kind of house can I afford? and his answer was, "If you want a million dollar house, I can give [it to] you." That was his answer. Whatever you want. And I said well, my question is what can I afford? And he said, "You just let me know how much you want to pay."

But the family's trust in the real estate agent was misplaced:

And when we were doing the paperwork, you know, we realized they put that we made more money than we, than we really did... And then he didn't say that he put that till he said okay, this -- "The bank is going to call and you need to say this." So he -- the person told us what to say and then my husband was like, "No, we shouldn't do this."

But the family put their trust in what they believed were knowledgeable professionals. The combination of the dubious mortgage and the loss of one income when their youngest son was diagnosed with autism and Mrs. Henriquez had to stop working and stay home led to foreclosure and financial ruin. A once financially stable family now has nearly $60,000 in debt even after the foreclosure. The emotional toil has strained their marriage and disrupted their children's performance in school."

http://www.huffingtonpost.com/preeti-vissa/the-coming-crisis-what-in_b_787851.html

THIS ALSO HAPPENED IN THE UK: [see below].

WHY ARE THE PERPETRATORS NOT IN PRISON?? :angry: :angry:

Edited November 26, 2010 by eric pebble

[non frog]

.....

WHY ARE THE PERPETRATORS NOT IN PRISON?? :angry: :angry:

People keep voting for them

[kingsgate]

So, someone offered these people a big loan to buy a house and suggested that they lie about what they earned.

They knew that they would struggle to afford the payments on this loan. They did not have to take it.

Yes, the estate agents who encouraged them to lie are partially to blame.

But: it takes two to tango.

These people happily went along with lying about their earnings, and chose to get a much bigger house than they could really afford.

So, they could only just afford the mortgage payments with both people working and no other expenses. So as soon as anything went wrong, they would be in trouble.

And it did.

My sympathy here is somewhat limited.

Greed all round.

[Lepista]

Yes, but Eric - they got to live in a nice big house for a year or two. $60k is peanuts to be able to live the dream for that amount of time.

They should be grateful to them.

[DeepLurker]

My sympathy here is somewhat limited.

Greed all round.

+1

On the one hand, the estate agent clearly encouraged the fraud, so deserves to spend several years sharing a small cell with a drug dealer who has homosexual tendencies.

On the other hand, this fraud cannot be compared to - for example - endowment policies here in the UK, where people were misled as to what the financial instruments actually did. Here, the "victims" clearly put made-up numbers in the box. They were in on the fraud.

[eric pebble]

+1

On the one hand, the estate agent clearly encouraged the fraud, so deserves to spend several years sharing a small cell with a drug dealer who has homosexual tendencies.

On the other hand, this fraud cannot be compared to - for example - endowment policies here in the UK, where people were misled as to what the financial instruments actually did. Here, the "victims" clearly put made-up numbers in the box. They were in on the fraud.

Yes - but the really sad thing is - for ANYONE who wanted to put a roof over their head - once the ball was running, once the Pyramid scam was up and running, IN ORDER TO KEEP UP - they HAD TO join in the scam - or get nothing.... THAT is INSIDIOUS. & Evil.

[kingsgate]

Yes - but the really sad thing is - for ANYONE who wanted to put a roof over their head - once the ball was running, once the Pyramid scam was up and running, IN ORDER TO KEEP UP - they HAD TO join in the scam - or get nothing.... THAT is INSIDIOUS. & Evil.

From the article, I don't think this was the same situation as, say, people exaggerating their income in London just to afford ANYWHERE to buy.

The implication here is that he was basically told "just name what you want - and how much you want to borrow, and we'll help you lie to get it":

"We said what kind of house can I afford? and his answer was, "If you want a million dollar house, I can give [it to] you." That was his answer. Whatever you want. And I said well, my question is what can I afford? And he said, "You just let me know how much you want to pay."

[eric pebble]

From the article, I don't think this was the same situation as, say, people exaggerating their income in London just to afford ANYWHERE to buy.

The implication here is that he was basically told "just name what you want - and how much you want to borrow, and we'll help you lie to get it":

"We said what kind of house can I afford? and his answer was, "If you want a million dollar house, I can give [it to] you." That was his answer. Whatever you want. And I said well, my question is what can I afford? And he said, "You just let me know how much you want to pay."

Same thing went on here in the UK. Don't kid yourself that it didn't.

[Peter Hun]

Liar loans are good.

The first people to get repossessed and the more the merrier as far as I'm concerned.

[Democorruptcy]

Eric,

Have you ever thought about doing a bit of editing at Wikipedia?

I was reading a few pages yesterday and thought that they could be improved a lot - not sure if you can use tall red text though.

I bet you or some other HPCers could get stuck into a few of these and other relevant pages:

http://en.wikipedia.org/wiki/Sir_James_Crosby

http://en.wikipedia.org/wiki/HBOS

http://en.wikipedia.org/wiki/Northern_rock

http://en.wikipedia.org/wiki/Bradford_and_Bingley

http://en.wikipedia.org/wiki/Financial_Services_Authority

http://en.wikipedia.org/wiki/Liar_loans

http://en.wikipedia.org/wiki/Real_estate_bubble

http://en.wikipedia.org/wiki/Affordability_of_housing_in_the_United_Kingdom

http://en.wikipedia.org/wiki/Asset_price_inflation

http://en.wikipedia.org/wiki/Bank_of_england

http://en.wikipedia.org/wiki/Inflation

Edited November 26, 2010 by Redhat Sly

[Rachman]

WHY ARE THE PERPETRATORS NOT IN PRISON?? :angry: :angry:

do you really believe this latino family are innocent - that they didn't realise that a big house would cost a lot of money. It's amazing how people are always innocent and how it's always someone else's fault..... I suspect they knew EXACTLY what they were doing and are only pretending to be thick and hard done by now ....eeeeehhh, greeeengo, you seen my new 05 Silverado...........

[Rare Bear]

So, someone offered these people a big loan to buy a house and suggested that they lie about what they earned.

They knew that they would struggle to afford the payments on this loan. They did not have to take it.

Yes, the estate agents who encouraged them to lie are partially to blame.

But: it takes two to tango.

These people happily went along with lying about their earnings, and chose to get a much bigger house than they could really afford.

So, they could only just afford the mortgage payments with both people working and no other expenses. So as soon as anything went wrong, they would be in trouble.

And it did.

My sympathy here is somewhat limited.

Greed all round.

Yes, greed all the way along. Greed by the buyers, greed by the lenders, greed by the vendors. And the people who should have controlled it all by regulation were only too happy for it all to continue as the governments were getting more taxes and the voters felt richer and happier. Nirvana, at least as long as prices kept rising faster than inflation in general.

[Caveat Mortgagor]

Eric,

Have you ever thought about doing a bit of editing at Wikipedia?

I was reading a few pages yesterday and thought that they could be improved a lot - not sure if you can use tall red text though.

I bet you or some other HPCers could get stuck into a few of these and other relevant pages:

http://en.wikipedia.org/wiki/Sir_James_Crosby

http://en.wikipedia.org/wiki/HBOS

http://en.wikipedia.org/wiki/Northern_rock

http://en.wikipedia.org/wiki/Bradford_and_Bingley

http://en.wikipedia.org/wiki/Financial_Services_Authority

http://en.wikipedia.org/wiki/Liar_loans

http://en.wikipedia.org/wiki/Real_estate_bubble

http://en.wikipedia.org/wiki/Affordability_of_housing_in_the_United_Kingdom

http://en.wikipedia.org/wiki/Asset_price_inflation

http://en.wikipedia.org/wiki/Bank_of_england

http://en.wikipedia.org/wiki/Inflation

I like your thinking!

[Blod]

Sorry there is only one party in this tale that had a legal duty, did they or did they not honour that duty?

The other party are guilty by the fact that they went along with the fraud but wouldn't have been able to commit it without the assistance of those who should have stayed inside the letter of law.

It is those with that duty od care who should shoulder the majority of blame.

Its for that reason that we all get angry about liar loans. :angry:

[tomwatkins]

Sorry there is only one party in this tale that had a legal duty, did they or did they not honour that duty?

The other party are guilty by the fact that they went along with the fraud but wouldn't have been able to commit it without the assistance of those who should have stayed inside the letter of law.

It is those with that duty od care who should shoulder the majority of blame.

Its for that reason that we all get angry about liar loans. :angry:

Agreed but remember it's far easier to walk away here in Uncle Sam land. In fact it's dead easy.

[Bloo Loo]

From the article, I don't think this was the same situation as, say, people exaggerating their income in London just to afford ANYWHERE to buy.

The implication here is that he was basically told "just name what you want - and how much you want to borrow, and we'll help you lie to get it":

"We said what kind of house can I afford? and his answer was, "If you want a million dollar house, I can give [it to] you." That was his answer. Whatever you want. And I said well, my question is what can I afford? And he said, "You just let me know how much you want to pay."

Yep its a conspiracy to defraud...in the US this is also known as racketeering, or the methods used in the Mafia.

Course, its all totally innocent and harms no-one, as long as they continue to pay.

Except, Mr K, ALL prices are put up by these overbidders, and the winners are the Bonus receivers at Ponzi based Organisations...like banks.

[Kootenai Brown]

Yes - but the really sad thing is - for ANYONE who wanted to put a roof over their head - once the ball was running, once the Pyramid scam was up and running, IN ORDER TO KEEP UP - they HAD TO join in the scam - or get nothing.... THAT is INSIDIOUS. & Evil.

I wish someone like that estate agent would help me out. My rental place doesn't have a roof and it's gonna snow this weekend!

[MrPin]

I know a few people who exaggerated things to get their first mortgage!

It's a wager on things getting better!

For three quarters of them it worked!

The others were ******ed, but it's a gamble, eh!

[winkie]

It is only human nature that many people if they had a chance to get something for nothing they would jump at it...the whole system was engineered to make money for all concerned......now look where it got us standing in the bail out queue.....whilst a few have grabbed the money and run, thank you very much, you allowed it, you sort it.

[eric pebble]

It is only human nature that many people if they had a chance to get something for nothing they would jump at it...the whole system was engineered to make money for all concerned......now look where it got us standing in the bail out queue.....whilst a few have grabbed the money and run, thank you very much, you allowed it, you sort it.

So true....

[eric pebble]

PREDATORY LIAR LOANS:

...//...

THIS ALSO HAPPENED IN THE UK: [see below].

WHY ARE THE PERPETRATORS NOT IN PRISON?? :angry: :angry:

Nearly 1 year later --- nothing has changed....

[zebbedee]

So, someone offered these people a big loan to buy a house and suggested that they lie about what they earned.

They knew that they would struggle to afford the payments on this loan. They did not have to take it.

Yes, the estate agents who encouraged them to lie are partially to blame.

But: it takes two to tango.

These people happily went along with lying about their earnings, and chose to get a much bigger house than they could really afford.

So, they could only just afford the mortgage payments with both people working and no other expenses. So as soon as anything went wrong, they would be in trouble.

And it did.

My sympathy here is somewhat limited.

Greed all round.

I have no sympathy for any of them, the mortgagor, mortgagee, the politicians, the under writers. They all conspired to create a boom brought about by credit expansion. The only victims in the piece are those who did not partake in the ponzi-me and others who think that working hard and saving for what you want are being raped to continue the ponzi. I can't wait for the collapse of the currency system involved!!!

[RichB]

I have no sympathy for any of them, the mortgagor, mortgagee, the politicians, the under writers. They all conspired to create a boom brought about by credit expansion. The only victims in the piece are those who did not partake in the ponzi-me and others who think that working hard and saving for what you want are being raped to continue the ponzi. I can't wait for the collapse of the currency system involved!!!

Did you watch that series about it? Freefall:

[nmarks]

WHY ARE THE PERPETRATORS NOT IN PRISON?? :angry: :angry:

Cos prisons are full of people that stole a bottle of water.

[Blod]

I saw the Cameron interview where he was asked in a roundabout question why "crime" was OK for some, he became most obviously evasive and embarrassed. What stuck in my claw was that the interviewer immediately changed tack as if he had almost asked the wrong question, odd.

Our political classes nowadays have a weak moral compass, there is no true party political power which in the past would have checked their lies and falsehoods. They consider spin above policy and actions. Look at how today we see that, though we were told that migration from outside the EU would be reduced, the opposite is happening.