April 04, 2008
The Crooked Citizen takes a Mortgage
.
John and Jane, brokers, sit in their mortgage originator store front office. They spy a couple reading their window adverts.
"Come in, come in. And how are you lovely folks today?"
"Good." "Good."
"May we ask you if you rent or own?"
"Ah, you rent. $900 a month and it's tight. We see." (They huddle a moment.)
"Folks, we've assessed your case and our thinking is if you sign right here for a thousand a month mortgage, we'll see that you get a quarter of a million dollars to get that home you have your eye on. How's that?"
"Don't you have to write down all your credit card debt?" "No. Your application looks great, just as it is."
"And what will your mortgage and mortgage rate be at the end of the initial term? No one can say for sure but the standard operating procedure is that you come back and refinance with the new higher value of your home". "Everybody does, just SOP, right Jane?"
"SOP, everybody does."
"You're curious how we get paid. Well, it comes from the lender's part of the deal. It isn't a lot but we get to put good folks in great homes. That's a big reward right there."
"All set? See ya later. You're welcome, thank you."
John and Jane high five, laughing!
"What a couple of con artists those two are, borrowing a quarter mil on their credit record."
John and Jane, brokers, sit in their mortgage originator store front office. They spy a couple reading their window adverts.
"Come in, come in. And how are you lovely folks today?"
"Good." "Good."
"May we ask you if you rent or own?"
"Ah, you rent. $900 a month and it's tight. We see." (They huddle a moment.)
"Folks, we've assessed your case and our thinking is if you sign right here for a thousand a month mortgage, we'll see that you get a quarter of a million dollars to get that home you have your eye on. How's that?"
"Don't you have to write down all your credit card debt?" "No. Your application looks great, just as it is."
"And what will your mortgage and mortgage rate be at the end of the initial term? No one can say for sure but the standard operating procedure is that you come back and refinance with the new higher value of your home". "Everybody does, just SOP, right Jane?"
"SOP, everybody does."
"You're curious how we get paid. Well, it comes from the lender's part of the deal. It isn't a lot but we get to put good folks in great homes. That's a big reward right there."
"All set? See ya later. You're welcome, thank you."
John and Jane high five, laughing!
"What a couple of con artists those two are, borrowing a quarter mil on their credit record."
Labels: 1929, application enhancement, bankruptcy, CDOs, foreclosures, Great Depression, mortgage brokers, sub prime
Comments:
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The mind boggles doesn't it. When the Frogette and I were shopping for a mortgage, we were advised to take out a second for the down-payment despite having ready cash to cover 20%. We were also advised to take out a "interest-only" loan.
Madness.
Madness.
# posted by 
: April 06, 2008 10:53 AM
: April 06, 2008 10:53 AM
Wow. Madness and a loss of any semblance of sound banking principles. Your story is the icing on the cake.
If any one wished to buy some gold, or foreign exchange or pig's bellies there are rules as to how much equity must be in the account.
But you and others are offered control of housing assets in the hundreds of thousands of dollars with no equity. It does not make any sense.
Imagine if Bush had got his social security private accounts and the brokerage industry had stuffed away a trillion of bad mortgage paper in these accounts.
America is being raped financially and constitutionally by the now ruling clan. Ugh.
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If any one wished to buy some gold, or foreign exchange or pig's bellies there are rules as to how much equity must be in the account.
But you and others are offered control of housing assets in the hundreds of thousands of dollars with no equity. It does not make any sense.
Imagine if Bush had got his social security private accounts and the brokerage industry had stuffed away a trillion of bad mortgage paper in these accounts.
America is being raped financially and constitutionally by the now ruling clan. Ugh.
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