Posted on 04/06/2008 5:37:20 PM PDT by Clintonfatigued
District Attorney Scott Storey of Jefferson County, Colorado is one busy lawman. The local housing market is chock full of mortgage fraud varmints. One particularly pesky ring, operating for roughly 5 years, recruited hundreds of illegal immigrants to act as “straw buyers,” the lowest players in the mortgage fraud game. Ringmasters were mortgage brokers, realtors, and loan officers in local banks. Straw buyers were supplied with stolen identities, including drivers licenses, social security cards, and income tax returns. Some were given green cards of legal immigrants. What couldn’t be stolen was forged.
False docs in hand, straw buyers obtained mortgage loans they had no intention of paying. Some 300 single family homes in Jefferson County and the adjoining Denver area are known to have been involved. In 191 transactions every single qualifying document was fake. So far, 38% of the mortgage loans have gone into foreclosure. Millions of dollars have been lost.
Tuff luck for lenders? Not as much as you’d think. The mortgages were insured by the Federal Housing Administration (FHA), a sub agency of the U.S. Department Of Housing and Urban Development (HUD). Taxpayers picked up the bad. Expect them to pick up more. D.A. Scott Storey believes thousands of other properties were obtained by the same ring and that similar frauds are widespread in the Denver area. And in an August 24th Denver Post article, “FHA program key in surge of foreclosures,” a government source estimated that “20,000 illegal immigrants hold FHA mortgages in metro Denver alone.”
(Excerpt) Read more at homelandstupidity.us ...
Thank you for the links, george76.
There may be more, but that is all I could quickly find.
Likely many more scams with ‘no money down’ deals.
If one was renting a small apt : why not ‘buy’ a bigger house for ‘no money down’ ?
It could be free rent for a while, too ?
thanks, bfl
Great post.
I had a quick look, and sure enough, some developers and their associates in various other kinds of work are going down, too. It should be an interesting show.
“I had a quick look, and sure enough, some developers and their associates in various other kinds of work are going down, too. It should be an interesting show.”
Is it wrong of me to wish that all those involved should be paid in Zimbabwe dollars for the next few years?
A study of these insane “don’t ask, don’t tell” loans showed that 60% of the applicants lied on their applications. There were scammers scamming other scammers all across the fruited plain. And Hillary and Obama are hot to trot out a bail-out for these fraudulent borrowers...with our tax dollars, of course. After all, the Clintons don’t want to use their $110,000,000 on any charity but themselves in their “foundation.”
Some of the evildoers who are nearly as wise as they believe themselves to be might consider moving to Zimbabwe very quickly.
[Little humor there.]
I wonder if the freepers from Quisling Realty will chime in on this thread?
Problem 1 is to apportion the blame. And I say, it can’t reasonably be done, unless you want to outlaw the profit motive.
It is true, that a massive effort could root out the worst of the worst mortgage brokers, but the fact is, these guys produced loans that the lenders wanted. I worked as a loan originator in 2006. If the loan scenarios (eg; how much income rel to how much debt, the whole “picture”) didn’t conform to lenders’ specs, we had 85 different lenders we could go to. SOMEONE would approve ANYTHING, it was just a matter of how much Xerox and Fed Ex expense you wanted to go thru.
I really have 2 points: An effort to prosecute the bad boys of this industry has to go right to the top, the BSCs and the Lehmans, and we not only see they are being bailed out, but the details of their transaction are being deliberately hidden from view, because the mark-to-market valuations of the toxics on their balance sheets would create a financial firestorm.
IF you are going to prosecute the originating brokers on the grounds that THESE were the people at the center of encouraging lies, finding the corrupt appraisers and getting the docs signed FACE to FACE, that the crimes occurred OVER THEIR DESKS, then it’s very much akin to prosecuting the street drug dealers and not the big time smugglers. (I’m totally neutral on this, if the banks want to prosecute, so be it, it was flaming mortgage fraud, a felony, then, and it is mort fraud now.) But if you DO want to prosecute, then just get the obvious repetitive names off the originating documents, round those people up, and confiscate their homes and BMWs. It should be really easy. There needn’t be any great Sherlock Holmes effort. The names are right there in black and white and nobody needs to be claiming they are any kind of great crusading hero cleaning up the industry. But get the underwriters at IndyMac and Chase and Greentree and Aurora, too, not just the shlumps. And get the dudes at Lehman who put these securities together. Oh, while you’re at it, get the heads of the ratings agencies who graded all this crap “AAA”....AND STILL DO!!!! After all, there is NO provision for increased oversight in the proposed new regs for the banking industry. Just $6 billion in tax breaks for the homebuilders, who both overbuilt and originated plenty of these hallucinogenic mortgages. Oh yeah, then there’s the $29 billion no-recourse taxpayer loan for JPMorgan and who knows how many more billions of dollars loaded onto the taxpayer. It’s a strategy of enforced numbness.
I just think there’s no mystery whatsoever as to how this happened. I realize I might sound apologetic, and that’s not my intention.
All I am saying is that functionally, the damage has been done, the default and foreclosure losses will have to be taken by someone. Ultimately, the banks will likely figure out a way to unload much of their losses on the taxpayer. ANY money spent trying to imprison the bad guys, decipher their methods, find the crooked appraisers and brokers and underwriters, and even throw themm in prison, is just MORE taxpayer squandered. The money is gone. There is no receovery mechanism available other than tax writeoffs to the best-heeled. And that, as well, is essentially a taxpayer hit.
I just get tired of every aspect of this turning into a taxpayer-financed error.
I agree with what you wrote and that the justice effort “has to go right to the top.” But in some of the more local scenes, we also find bribery, theft, drugs, and the like—even in higher local places. ;-)
I know Scott. He's a good man.
They do all deserve to lose everything they scammed people out of. I too have zero sympathy for anyone in the mortgage scamming industry. It was a big con for a few years, lots of people got rich, lots of people got to rent a big house rent-free for a year or so. There are few innocents in this equation. Most of those “hardest-hit” had zero down, so at worst they lose some rental digs. The brokers who promised jumbo loans for $500 “month after month” are the ex-used car salesmen, and they are now crying that their gravy train has been sabotaged. Too freaking bad. Get a job.
“I agree with what you wrote and that the justice effort “has to go right to the top.” But in some of the more local scenes, we also find bribery, theft, drugs, and the like—even in higher local places. ;-)”
Oh yeah. But...my main point is that we’re scarcely out of the “table of contents” and into “chapter one” of this tawdry little novella as far as prosecuting the bad actors and we are seeing the boyz at the very top bailed getting out with gusto. Not only bailed out, but given tax breaks! So where do we go with this? Let me be clear, there are local originators who Xeroxed or forged signatures onto documents. That’s already a crime long ago and far away and should be vigorously prosecuted. And it is arguably criminal to “coach” a borrower on how to fill out the application to get by the underwriters; basically suborning mortgage fraud. EXCEPT: All the banks had “coaching sheets” as to how to get borrowers approved under the various loan programs offered! For example, on a “stated income” loan, you do NOT want any item of additional information entered! You do NOT want to furnish any corroborating data. And the Aurora/Chase “helpful hints” sheets explicitly stated this. It was “wink/nod” all the way.
I don’t hate, batsh*t, I really don’t.
I just become angry every April 15th when I have to write out yet another ridiculous check to the IRS to support amok institutions like fannie mae and freddie mac. And soon I’ll be able to pay the mortgages of the idiots who dreamed of home ownership with no possible ability to even begin to deserve it.
But I wouldn’t mind taking a sledge hammer to your 740i!
(Just teasin’! I don’t begrudge ANYONE their honest rewards for hard work and good fortune!)
;>)
Just doing the jobs Americans aren't willing to do. Aside from the fact that they broke the law getting here, staying here and are committing fraud on stolen ID's, they're just trying to feed their families. Waiting for Dane to show up to castigate those who notice the citizenship status.
To: Freedumb
Gotta hand it to the MSM, the WSJ, the Chamber of Commerce, the Fed, the banks, the White House, the Congress, Fortune, Kudlow, and all the rest of the usual suspects. These subprime mortgages go to someone. They have a mailing address. By artful writing and punditry, the picture has been painted that the people who got these subprime loans are poor folks or dumb boomers who re-financed to buy their new Volvo and swimming pool. Wrong!
Those cases are few. Those subprime mortgages issued in the last several years that are now facing foreclosure have gone to illegal aliens, landlords who rent to illegal aliens, and minorities who have lost jobs to illegal aliens, especially African-Americans in the trades and services industries. The common thread - illegal aliens. Spend 10 minutes on Google and you can see the aggressive marketing of subprimes to illegals (you may have to translate).
The distribution of subprimes going into foreclosure closely matches the concentrations of illegal aliens - California, the southwest border states, the southeast states, metro areas like Denver and in the Rust Belt. Many of these mortgages were granted to buyers with no SS number or a stolen number or just a taxpayer ID number. Who is that group? Not blacks; not boomers. Not even speculators. Who's left? You figure.
Some common scenarios: An illegal, actively recruited by banks or mortgage lenders, buys a house, often an expensive house ($600,000). If he can't qualify, he gets other illegals added to the mortgage until they qualify. Or a profiteering landlord buys a house with the intent of setting up a dorm house for illegals. With 10-20 illegals crowded in at $300-400 rent, he makes a tidy profit even with a big mortgage payment.
Like Ponzi, it was great for everybody. The banks made big profits on the high interest. So did the REIT and funds managers. The landlods did well also on rents and house appreciation.
Then the housing bubble burst. The illegal renters started losing work and were evicted. The landlords couldn't service the mortgage and/or with lowering values the mortgages went upside down so it was easy to walk away and foreclose.
But that's not the big story. It's how effective the cabal of power brokers from the White House, the Chamber of Commerce, the MSM, the Congress, the banks, the CEOs, and the unions have covered up this causality so that they can get amnesty and open borders rammed through to guarantee an unending supply of cheap alien labor.
They know that if the connection between illegal alien hordes and the subprime collapse and the damage to the economy worse than the Savings & Loan scandal of the 1980's, the people will be outraged and demand we close the borders.
Can't have that. Let's keep the sheeple in the dark. They'll be the suckers paying for it in the end with lost jobs and higher taxes. The real villians have already made their fortunes.
8 posted on 03/23/2007 9:11:29 AM PDT by oldbill
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