Comments on: Is Fraud The Cause of the Mortgage Meltdown? http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/ The Unofficial Guide to FHA Loans & Mortgages Mon, 08 Sep 2008 01:53:42 +0000 http://wordpress.org/?v=2.6 By: Peter G. Miller http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-705 Peter G. Miller Fri, 02 Nov 2007 18:12:27 +0000 http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-705 Matt -- Thanks for your post. Certainly you make a good point. However, the real question is how do we stop toxic loans going forward. The answer is to cut off supply so there is nothing to securitize. This means having a system where loan officers must act as agents for borrowers and seek the best possible rates and terms. Matt –

Thanks for your post.

Certainly you make a good point. However, the real question is how do we stop toxic loans going forward. The answer is to cut off supply so there is nothing to securitize. This means having a system where loan officers must act as agents for borrowers and seek the best possible rates and terms.

]]> By: Matt http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-704 Matt Fri, 02 Nov 2007 18:07:41 +0000 http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-704 50% borrower, 50% broker, 100% blame on the people who trusted an unproven system and made ultra flexible guidelines to make millions 50% borrower, 50% broker, 100% blame on the people who trusted an unproven system and made ultra flexible guidelines to make millions

]]> By: Matt http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-703 Matt Fri, 02 Nov 2007 18:06:23 +0000 http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-703 Why dont you blame the guys on wall street who saw an opportunity to make flexible guidelines, make multi millions and have virtually zero liability...cmon lets get serious, they didn't care if they screwed up the economy because after the dust settled, they live above the rest of the economy. It's a joke, it's so obvious, yet so ignored, yet everyone is to blame though. Why dont you blame the guys on wall street who saw an opportunity to make flexible guidelines, make multi millions and have virtually zero liability…cmon lets get serious, they didn’t care if they screwed up the economy because after the dust settled, they live above the rest of the economy. It’s a joke, it’s so obvious, yet so ignored, yet everyone is to blame though.

]]> By: Peter G. Miller http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-544 Peter G. Miller Wed, 24 Oct 2007 21:27:53 +0000 http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-544 Marc -- Thanks so much for your posting. Much appreciated. Right now there is an effort to establish licensure standards for all loan officers -- something that would at least create some sort of minimal standard before someone could go out in the world as a mortgage loan officer. As to the buyers with the flexible W-2s, you have to decline the application. If the W-2 is fake, then you have to wonder what else might be inappropriate. Please keep posting, we appreciate your experience and candor. Marc –

Thanks so much for your posting. Much appreciated.

Right now there is an effort to establish licensure standards for all loan officers — something that would at least create some sort of minimal standard before someone could go out in the world as a mortgage loan officer.

As to the buyers with the flexible W-2s, you have to decline the application. If the W-2 is fake, then you have to wonder what else might be inappropriate.

Please keep posting, we appreciate your experience and candor.

]]> By: Marc Brinitzer http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-543 Marc Brinitzer Wed, 24 Oct 2007 21:11:56 +0000 http://www.fhaloanpros.com/2007/10/is-fraud-the-cause-of-the-mortgage-meltdown/#comment-543 Peter, I'm sure that fraud is a big part of the mortgage problem and it will subside as we have to document borrowers' incomes again. I've been a mortgage broker for 18 years and few things have more professionally distressing than watching the hoards of new lenders swarm the business, rip off consumers, and laugh all the way to the Ferrari dealership. The barrier to entry in our profession is so low that any slimy creature can crawl over it. That needs to change. That said, the consumer is far from innocent. Going cold turkey after the day-trading tech bubble burst, the lure of quick profits in real estate promoted by all the seminar hacks and Flip That House TV shows was just the next designer drug for the avaricious. I recently had clients who repeatedly sent me altered W-2's in their loan packages, so eager were they to "cash in". Do you think I could find a single soul to whom I could report that deception? Not. Peter, I’m sure that fraud is a big part of the mortgage problem and it will subside as we have to document borrowers’ incomes again.

I’ve been a mortgage broker for 18 years and few things have more professionally distressing than watching the hoards of new lenders swarm the business, rip off consumers, and laugh all the way to the Ferrari dealership.

The barrier to entry in our profession is so low that any slimy creature can crawl over it. That needs to change.

That said, the consumer is far from innocent. Going cold turkey after the day-trading tech bubble burst, the lure of quick profits in real estate promoted by all the seminar hacks and Flip That House TV shows was just the next designer drug for the avaricious.

I recently had clients who repeatedly sent me altered W-2’s in their loan packages, so eager were they to “cash in”. Do you think I could find a single soul to whom I could report that deception? Not.

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