What has caused the real mortgage problem? The OCC says there are nearly...
...35 million loans.? Office of the Comptroller of the Currency
September 12, 2008
The OCC and OTS Mortgage Metrics Report found that actions by national banks and thrifts to prevent home mortgage foreclosures increased faster than their new foreclosures during the second quarter of 2008, despite an overall decline in mortgage credit quality and an increase in foreclosures.
The combined report, which replaces separate reports by the two agencies, provides loan-by-loan data in a standardized format for 34.7 million first-lien mortgages—worth more than $6.1 trillion—held or serviced by national banks and thrifts.
http://www.occ.gov/ftp/release/2008-105.htm
On the other hand, some five million fraudulent home mortgages are in the hands of illegal aliens, according to the U.S. Department of Housing and Urban Development.
It's not known how many of those have contributed to the subprime housing mortgage meltdown, but it has affected every state, including Arizona.
The problem began years ago when banks were forced to give mortgages without confirming social security numbers or borrower identification. As a result, illegal immigrants were able to obtain home mortgages which they could not afford.
http://www.freerepublic.com/focus/f-news/2100080/posts
Banks are seeing an untapped resource in providing home loans to undocumented U.S. residents
August 8, 2005
http://money.cnn.com/2005/08/08/news/economy/illegal_immigrants/
So the banks decided that illegals could take out loans even though they were breaking our laws by being in our country illegally rather than turn them in to our government. Doesn't that make them the same as employers who hire illegals with fake documents knowing that they're illegals?
Summary of the HUD Research Series Examining Barriers to Hispanic Homeownership and Efforts to Address These Barriers
The requirement that borrowers be legal residents of the U.S. is obviously a challenging obstacle for the millions of undocumented immigrants in this country. A handful of lenders are attempting to assess whether lack of legal residence is an acceptable risk in extending mortgage credit; however, lending to illegal residents also involves political issues that may be extremely difficult to resolve.
Many of the individuals who took out mortgages could afford the payments when they purchased the homes.
However, interest rates skyrocketed, property taxes for some have gone up 400%, prices of all commodities and energy have skyrocketed also.
We have government on all levels squandering money, raising taxes, and whining for more money, more taxes. Noone on any level of government ever cuts costs.
So as a result, more and more people can't afford their homes, but the government doesn't care about them, just the fatcats on Wall Street, bailing them out so they can squander money on things like a $ 500,000 luxury spa outing for their executives---in a company that's already in bankruptcy. And then they give them even more billions in bailout money?
When banks can spend millions for bonuses and salaries, even though they're obviously in trouble and failing; they deserve to fail!!! DUH!
Our own government is overspending constantly, with the biggest deficit in history, which is growing by leaps and bounds.
If we don't do something about getting these free-spending politicians out of office, we're going to have more of the same.
Noone will be able to afford anything, at the rate that things are going.
Except for those involved with big oil, Wall Street fatcats, Haliburton and other cronies of the administration---they're making billions.
plain and simple... GREED
i believe it was nothing but greed on the part of:
- the mortage companies wanting more and more people indebted to them & lying so that people would be approved for well beyond their means
- the mortage brokers who got comissions on the higher the mortgage
- the people themselves who didn't think about tomorrow but only today. they didn't understand an ARM or didn't care or thought they could beat the system. they also wanted a house that was so hige, fancy or whatever that they spent well beyond their means.
i guess i was blessed to have a brain and the ability to ask questions of good people. my first ever mortgage was a 1 5 ARM. i was instructed - yes instructed - to make sure i could afford the mortgage payment of the highest it could ever be - we took the monthly payment, added the 2% above prime yearly and figured it out that -- yes even if it went up to the highest it would be tough but do-able. then i bought my first place - it was a whopping 900 sq ft - but it was mine! sadly all people want is more than is really needed. being in the process of purchasing a home right now -- my third since the initial - i'm having no problems. in the search i found homes that were a "song" and something i could well afford - right now. they were in the 3k-4k sq range and after the thrill of something like that reality set in.... the taxes once things picked back up, heating and cooling, up keep -- oh my goodness it was unreal! i am happily in a darling 1400 sq ft ranch witht he attached garage that was a priority and fireplace and guess what -- it's perfect!
1. It started with little oversight and criminal convictions of mortgage brokers committing fraud with the applicants. The unethical real estate agents the circus of people involved with home refinances/purchases etc. I have never met 1 broker that hasn't committed fraud just to get the refi/purchase accepted by the lenders. It not just illegal immigrants its everyone from all walks of society. I used to deal in high end real estate.
If there is not statute of limitation the fed/state gov't should go after them. They're easy to find. Look at the top producers (all commit fraud) as well as the cheesy local mortgage companies ( all try to rip off uneducated buyers/refi by charging higher interest rates than they qualify for so they can more money from the lenders knowing they consumer couldn't afford to make the payments.
Although the creative loans made it easier for consumers to get a mortgage the problem was the brokers committing fraud because many buyers/owners didn't qualify either because of debt, bankruptcy, income and lack of savings/assets.
2. The banking crises is due to the bundling of these fraudulent mortgages. The bogus insurance used to sell them. Corporate greed at its finest.
I'm all for personal responsibility but I'm also for consumer/taxpayer protection.
Nobody was forced to give loans without acquiring a social security numbers to do a credit check. That is a lie. In reality they were allowed to expedite the process by not requirng a credit check and to verify social security numbers considering a credit check should be able to verify any information needed.
A social security number check is a pretty redundant waste of time after doing a credit check, that does nothing but waste the bank's money having to pay someone to do them, as well as bog down the social security office resources having to verify them.
What caused this is the reduction of regulations resulting from these bills:
http://www.govtrack.us/congress/bill.xpd?bill=s106-900&tab=related
http://www.govtrack.us/congress/bill.xpd?bill=h105-10
This bill would have provided reguations repelaing parts of the bills above:
http://www.govtrack.us/congress/bill.xpd?bill=s109-190&tab=analysis
http://www.govtrack.us/congress/vote.xpd?vote=h2007-374
But as you can see after deregulation by Republican dominated congress, the bills restoring regulations were killed by Republican dominated committees in a Republican dominated congress, or wasn't passed until the crisis was in full swing.
Banks were giving loans to people that they new couldn't afford them and mortgage brokers were lying about their credit ratings telling banks they were grade A paper when they really weren't, legislation was originally passed to prevent discrimination but with a lack of regulation some people decided they could make a lot of money and took advantage of the system. Panic set in and people started fearing they would never be able to afford a home so they let themselves be talked into loans that they didn't understand. Truthfully there is no one party to blame this on, it was greed and fear that caused it and now we all pay the price.
]
Linear Mode
