Quote:
Originally Posted by BigFish
Again I refer you to the 60 Minutes episode....I do not have time to hit all the highlites but it was quite telling.
Lenders were simply approving mortgages for any and all comers without so much as checking social security numbers......most of the mortgages were varible rate mortgages and what happened was after a period of time the rates ballooned and many times the mortagages doubled and the borrowers were screwed! Yes the borrowers admitted their negligence but it was the lenders who were most careless in this scenario as they make their money on how many mortgages they sold......they would sell them and the bank that held them would in turn sell them to another mortgage house and so on and so on.....everyone was making money on it without regard for the consequences........so here we are!
It is the job of the lenders to check backgrounds and financials on the potential buyers and they were not doing it!
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And a huge percentage of the borrowers defaulting are in this country illegally. So if the lenders took the time to do a simple credit/background check, they never should have qualified for that mortgage to begin with. Never would have happened a few years ago, but as already stated, the lenders are such a greedy predator type, they'll let anyone borrow.
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