This article illustrates brilliantly how political interference in the mortgage industry, under the guise of the CRA, led to lenders falling over themselves to make reckless loans to "borrowers" who had no prospect of paying them off. Well, I wonder how that turned out?/s
In my mind this begs a question that maybe some Freepers with greater insider knowledge of the mortgage or mortgage wholesaling business might know: did HUD, and/or Fannie and Freddie actually condone disguising the nature of the loans that these lenders were forced into? Were the prospectuses for such loan packages/ABS bond issues legally doctored to conceal the toxic nature of these mortgages? Or did Fannie and Freddie just assist in stirring this junk in with the other normal loans that got packaged under their good names?
Thank you for posting this.
I lived through it as part of the industry.
Somebody needs to lay the blame where the blame is.
Thanks for posting this. Very prescient.
Nice find. Bookmark for later.
So why didn’t people jump up and down about this long ago . . .before the situation got out of hand?
ping for later
Such as Barack Obama's ACORN "Community Organizing" group!!!
It is scaring the (bleep) outa me that this militant group with this militant activist/agitator alumnus is getting anywhere near the most powerful postion on earth!!!
I don’t think it was disguised. I think banks were made to feel more comfortable originating and selling these loans. They probably thought that since the govt wanted them to do these loans, what could possible go wrong down the road. I have been in the business for 9 years and I have been telling people that our problems today can be dated back to the late 90’s when all the programs came out that were very easy to qualify for. I know the bank I used to work for did several loans based on their CRA value and not their credit worthiness. You reap what you sow.
I don’t think it was disguised. I think banks were made to feel more comfortable originating and selling these loans. They probably thought that since the govt wanted them to do these loans, what could possible go wrong down the road. I have been in the business for 9 years and I have been telling people that our problems today can be dated back to the late 90’s when all the programs came out that were very easy to qualify for. I know the bank I used to work for did several loans based on their CRA value and not their credit worthiness. You reap what you sow.
I don’t think it was disguised. I think banks were made to feel more comfortable originating and selling these loans. They probably thought that since the govt wanted them to do these loans, what could possible go wrong down the road. I have been in the business for 9 years and I have been telling people that our problems today can be dated back to the late 90’s when all the programs came out that were very easy to qualify for. I know the bank I used to work for did several loans based on their CRA value and not their credit worthiness. You reap what you sow.
Community Organizers? Thanks but no thanks.
Bill Clinton, the rats John F Kennedy, thank you!you have given us the gift that keeps on giving. The middle class that you and now obama swear were going to help in these hard times have given us the BILL to pay on these reckless financial scams that made you and a lot of other rats big money at the middleclass expense.
NOW OBAMA IS MAKING THE SAME CLAIM, HE WILL HELP THE MIDDLE CLASS. dejvu? Fool me once shame on you fool me twice shame on me!
Thank Goodness we got a Republican administration in place in time to avert any problems.
The Clintons planned on using a cut of the take to finance their political empire. Then 0bama came along and usurped it from them.
Well, hillary, can’t you appreciate the bitter irony of it all?
mark for AM coffee
Yet another liberal fantasy run amok — leaving a mess for the adults to clean up.
Oh, I am SO bookmarking this.
Bookmark and bump
Great find.
Directly related to this are non mentioned parts of the Housing Bill recently passed that remove Kelo protections and fund cities for repossessing via eminent domain whole neighborhoods with govt grants....read this carefully...Eminent Domain related issues in the Housing Bill: http://www.libertymatters.org/newsservice/newsservice.htm
President Bush just signed another taxpayer-funded piece of constitutionally challenged legislation to bail out 400,000 home buyers who face forclosure in the failing Bush economy. The government’s latest intrusion into market issues, the Housing and Economic Recovery Act of 2008, may have far-reaching ill effects on private property, however. Among other provisions, “it creates a new regulator for ailing mortgage giants Fannie Mae and Freddie Mac and establishes a $300 billion program to expand the Federal Housing Administration’s ability to guarantee mortgages.” And, writes John Berlau, “of all the unintended consequences of the housing bill, one of the most ironic and far-reaching may be this: that whatever security marginal homeowners have from foreclosure, their homes will be far less safe from being taken by a bureaucrat through eminent domain.” Included in the package is $3.9 billion for Community Development Block Grant funds. Those funds will allow cities and counties to take private properties and then sell them to private developers, thanks to the 2005 Supreme Court Kelo decision. The Senate made an attempt to protect property owners from greedy governments by inserting a clause stating, “No funds under this title may be used in conjunction with property taken by eminent domain unless eminent domain is employed for a public use.” But, that clause disappeared from the House version after House Financial Services Chairman Barney Frank (D-MA) and Treasury Secretary Henry Paulson got their heads together. The new language allows bureaucrats to use the billions in federal grants to seize homes for general economic development, as provided under Kelo, and then pull the old “bait and switch” by creating a new project to sell the land to developers, likely not a violation of the House bill. “All in all,” writes Berlau, who writes the Open Markets blog for the Competitive Enterprise Institute, “this new language means that…there will be virtually nothing stopping states and localities from using the federal housing grants to help themselves to confiscate housing.” How ironic that a man who won his first Governor’s race by championing private property no longer believes in its importance to the future security of individual Americans or our nation.
‘Kelo’ Property Rights Protections gutted from housing bill
Congress’ bailout opens doors to eminent domain seizures:
http://www.libertymatters.org/newsservice/2008/faxback/3253_emdom.html
It is conceivable, esp. in California, for whole areas of a city to be claimed and dedicated as a blocked area to same sex couples with adopted children to be otherwise integrated into a heretofore tradititonal US community. Such a community lends itself to ‘children swapping’ pedophilia activities.
BTTT! Not Bush’s fault! ;-)