I don’t share your sentiment. I think the feds need to review the mortgage application. If income and/or assets are mistated, the borrower will have to explain to the feds why there is such a huge discrepency. Many borrowers will blame the mortgage broker, then the feds should haul both in front of an investigator. Either or both lied and have committed fraud. I don’t think the borrower should just suffer foreclosure, he/she should also suffer jail time if they lied on the loan application. That is how all this crisis started, broker and borrower lying on the application.
We don’t even jail, enough, real criminals in this country. The banks voluntarily loaned, on known shaky collateral, to minimal borrowers that they had reason to believe would have trouble making payments. That is a personal, civil problem between these two parties.
Since the government chains us all together such that if a crack addict can’t get the full cable sports package, we have to be taxed for it, we are now chained to those two above parties by both Republicans and Democrats ‘to help the homeowner’, which means help the sloppy, lazy, greedy banks, mortgage underwriters, and bowers and even the local governments.
Nice.
And the government wonders why productive citizens don’t want to risk their money, make investments, fend off local, state and Federal business codes, permits, permissions, inspections, laws, rules, regulations, fines, fees and penalties....plus had over half of your profits.....and pay for others and, if in the real estate or banking business..pay for your failed competition.
That's the mortgage loan officer at the Bank's job! Geeze - you want government to run everything. Obama would love it! Borrowers/lenders colluded because the CRA made it almost illegal for Banks to underwrite loans.
What is the government's job is making sure fraudulent operations like Acorn can't operate - and that means stringent laws about loan to value, income verification, amount limit on seconds, limit on number of houses you can leverage, equity requirements etc.
It is up to the Banks to enforce these laws...you seem to want some weenie in DC deciding if your a good guy or not. I want my Banker, who I have built up a relationship with over time, to be in charge of that.