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Morning Legal Briefs

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35. Re: Morning Legal Briefs Oct 29, 2012, 23:23 Wowbagger_TIP
 
Beamer wrote on Oct 29, 2012, 22:30:
Wowbagger_TIP wrote on Oct 29, 2012, 22:24:
Beamer wrote on Oct 29, 2012, 20:40:
I sadly worked for a subprime mortgage company in the early 2000s. One of the better ones, sadly. No one was forcing anyone to give those loans, in fact the companies were bending over backwards. Did your numbers not work? We fired one sales manager for advising his loan officer to advise his customer to photoshop his pay stubs. That guy was rehired at a much bigger company in under a week.

No, everyone wanted to give bad loans (and, incidentally, get bad loans.) The thought was that everything would be consolidated, sold off in a package, and probably work out for the best. If not, well, by that point it was someone else's problem.

As it turned out, it was all of our problem. Pretty much everyone deserves blame here. Bankers. Loan officers. Borrowers. Bill Clinton. George Bush.
Don't forget Congress. Aside from the Bankers, who sure as hell should have known better, they are the most guilty. Banks are supposed to do the underwriting and not tell people they can afford more than they actually can, but I had that happen when I was looking for a house. Thankfully I had the sense to go with what I knew I could afford, and get a regular 30yr fixed mortgage, but a lot of banks were just telling people what they wanted to hear. That homes are a great investment and that they'll just keep going up in value, so it's no problem, and we've got this cool new type of mortgage so you can have affordable payments, etc.

It was fraud, fueled by greed, plain and simple, but a lot of people were too ignorant about finance and/or too greedy to care, so they signed for those stupid loans. Probably why Congress was so quick to bail out the banks too, as they were largely responsible for the laws that allowed it to happen. Of course they still caved to the banks afterwards and made sure to water down and stonewall all the reforms so that they banks stay fat and happy and still legally allowed to continue screwing with the economy.

Maybe the investment bankers should have, but they didn't. They didn't know better. Their models were too complex and faulty. And no one really knew.

But banks weren't underwriting these, subprime mortgage companies were. New regulations started originators, who would do the loan themselves then sell them. If no one would buy they loan they'd put them into scratch-and-dent, meaning they'd package a whole bunch of bad loans together and sell them off. Odds were only a small amount would foreclose. Turns out most did.


Yeah, you're right that they probably didn't actually know what was going on, at least not until it was too late. But everyone was doing things that were dumb and/or outright fraud. Either by duping the lendees, or by duping investors, or by duping ratings agencies, etc. Everyone thought they could make it someone else's problem. A lot of those packages were full of terrible loans and were still given AAA ratings and sold off as such. They were making so much money off of it that nobody cared. They just wanted their fat bonuses and someone else could deal with the fallout.
 
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"The whole problem with the world is that fools and fanatics are always so certain of themselves, but wiser people so full of doubts." -- Bertrand Russell (I think...)
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    Date Subject Author
  1. Oct 29, 10:57 Re: Morning Legal Briefs InBlack
  2. Oct 29, 11:42 Re: Morning Legal Briefs Cutter
  3. Oct 29, 11:48  Re: Morning Legal Briefs Axis
  9. Oct 29, 14:15   removed Cutter
  10. Oct 29, 14:45    Re: Morning Legal Briefs Beamer
  4. Oct 29, 11:52 Re: Morning Legal Briefs Creston
  5. Oct 29, 12:17  Re: Morning Legal Briefs Axis
  7. Oct 29, 13:40   Re: Morning Legal Briefs Bodolza
  44. Oct 30, 09:23    Re: Morning Legal Briefs RollinThundr
  46. Oct 30, 11:14     Re: Morning Legal Briefs Wowbagger_TIP
  47. Oct 30, 12:05      Re: Morning Legal Briefs RollinThundr
  48. Oct 30, 12:43       Re: Morning Legal Briefs Wowbagger_TIP
  49. Oct 30, 12:56        Re: Morning Legal Briefs Mr. Tact
  50. Oct 30, 13:13        Re: Morning Legal Briefs RollinThundr
  52. Oct 30, 16:07         Re: Morning Legal Briefs Wowbagger_TIP
  54. Oct 30, 16:24          Re: Morning Legal Briefs RollinThundr
  55. Oct 30, 17:55           Re: Morning Legal Briefs Wowbagger_TIP
  58. Oct 30, 22:04            Re: Morning Legal Briefs Bet
  14. Oct 29, 16:16   removed eDave
  15. Oct 29, 16:25    Re: Morning Legal Briefs Axis
  16. Oct 29, 16:47     Re: Morning Legal Briefs Wowbagger_TIP
  17. Oct 29, 16:59      Re: Morning Legal Briefs Axis
  22. Oct 29, 18:44       Re: Morning Legal Briefs Wowbagger_TIP
  24. Oct 29, 19:08        Re: Morning Legal Briefs Prez
  25. Oct 29, 19:46         Re: Morning Legal Briefs Orogogus
  18. Oct 29, 17:00      Re: Morning Legal Briefs Bodolza
  19. Oct 29, 17:15       Re: Morning Legal Briefs Axis
  20. Oct 29, 17:31       removed Cutter
  23. Oct 29, 18:45       Re: Morning Legal Briefs Wowbagger_TIP
  26. Oct 29, 19:52     Re: Morning Legal Briefs Mordecai Walfish
  27. Oct 29, 20:40      Re: Morning Legal Briefs Beamer
  28. Oct 29, 22:24       Re: Morning Legal Briefs Wowbagger_TIP
  31. Oct 29, 22:30        Re: Morning Legal Briefs Beamer
>> 35. Oct 29, 23:23         Re: Morning Legal Briefs Wowbagger_TIP
  36. Oct 29, 23:55          Re: Morning Legal Briefs Beamer
  37. Oct 30, 00:32           Re: Morning Legal Briefs Wowbagger_TIP
  30. Oct 29, 22:28      Re: Morning Legal Briefs jdreyer
  32. Oct 29, 22:31       Re: Morning Legal Briefs nin
  33. Oct 29, 22:48        Re: Morning Legal Briefs Beamer
  34. Oct 29, 23:09        Re: Morning Legal Briefs Prez
  39. Oct 30, 01:14        Re: Morning Legal Briefs mag
  41. Oct 30, 03:16         Re: Morning Legal Briefs jdreyer
  42. Oct 30, 08:46         Re: Morning Legal Briefs nin
  29. Oct 29, 22:26   Re: Morning Legal Briefs jdreyer
  6. Oct 29, 13:13  Re: Morning Legal Briefs Agent.X7
  8. Oct 29, 14:14 Re: Morning Legal Briefs Mr. Tact
  11. Oct 29, 15:07  Re: Morning Legal Briefs Creston
  12. Oct 29, 15:35   removed Axis
  13. Oct 29, 15:41 Re: Morning Legal Briefs Cutter
  21. Oct 29, 17:41 Re: Morning Legal Briefs NegaDeath
  40. Oct 30, 02:20  Re: Morning Legal Briefs Bet
  38. Oct 30, 00:59 Re: Morning Legal Briefs Mr. Tact
  43. Oct 30, 08:52  Re: Morning Legal Briefs Beamer
  45. Oct 30, 09:39   Re: Morning Legal Briefs Mr. Tact
  51. Oct 30, 15:51    Re: Morning Legal Briefs Beamer
  53. Oct 30, 16:07     Re: Morning Legal Briefs Wowbagger_TIP
  56. Oct 30, 18:35      Re: Morning Legal Briefs Beamer
  57. Oct 30, 18:49       Re: Morning Legal Briefs Wowbagger_TIP
  59. Oct 30, 23:35        Re: Morning Legal Briefs Beamer
  60. Oct 30, 23:56         Re: Morning Legal Briefs Wowbagger_TIP


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