Dad2three
Gold Member
Last note to you dad2three....
You said this....
The historical "originate and hold" mortgage model was replaced with the "originate and distribute" model. Incentives were such that you could get paid just to originate and sell the mortgages down the pipeline, passing the risk along.
You are correct.
Who was the one who did that for them?
Do you know?
Find out.
Then tell me who reprimanded the IG who reported issues with the above entity and how they did the above transactions.
Then tell me who said "there is no issue with the above referenced entity" and implied that claiming there was an issue was racially motivated.
Then take your childish way of posting and.....well......learn to act like an adult.
I'LL NOTE YOU COMPLETELY IGNORED THIS THREE TIMES. Weird
Q HOLY JESUS! DID YOU JUST PROVE THAT OVER 50 % OF ALL MORTGAGES IN 2006 DIDNT REQUIRE BORROWERS TO DOCUMENT THEIR INCOME?!?!?!?
A Yes.
Actually, it is not that they did not have to document it. They had to, under the oath of an affidavit, list their income on the application. This is required so an underwriter can make an educated decision based on the value of the home and the income of the borrower. What they did NOT have to do is produce a w-2 or a tax return.
Many lied. Many lied when they signed the affidavit at closing. Yes, the "victims" lied to get the loan.
Q WHO THE HELL LOANS HUNDREDS OF THOUSANDS OF DOLLARS TO PEOPLE WITHOUT CHECKING THEIR INCOMES?!?!?
A Banks.
Q WHY??!?!!!?!
A Two reasons, greed and Bush's regulators let them
Why would they do it? It is a recipe for disaster and any lending institution is well aware of it. Unless, of course, there is an impetus to take the risk of major losses. Hmmm....what could that have been? I mean, why would a lending institution take such a great risk for a mere 5% return on their money?
Seems you are confused with your facts sparky.
'Actually, it is not that they did not have to document it. They had to, under the oath of an affidavit, list their income on the application. This is required so an underwriter can make an educated decision based on the value of the home and the income of the borrower. What they did NOT have to do is produce a w-2 or a tax return.
Many lied. Many lied when they signed the affidavit at closing. Yes, the "victims" lied to get the loan.'
WEIRD, FBI SAID 80% OF THE FRAUD WAS LENDER INITIATED? I guess those 'victims'; shouldn't had dropped their underwriting standards? Why did the Banksters drop underwriting standards again? lol
"Why would they do it? It is a recipe for disaster and any lending institution is well aware of it. Unless, of course, there is an impetus to take the risk of major losses. Hmmm....what could that have been? I mean, why would a lending institution take such a great risk for a mere 5% return on their money?"
YEAH, I WONDER WHY?
Compensation schemes encouraged gambling: Wall Streets compensation system wasand still isbased on short-term performance, all upside and no downside. This creates incentives to take excessive risks. The bonuses are extraordinarily large and they continue$135 billion in 2010 for the 25 largest institutions and that is after the meltdown.
Wall Street became creative: The demand for higher-yielding paper led Wall Street to begin bundling mortgages. The highest yielding were subprime mortgages. This market was dominated by non-bank originators exempt from most regulations.
Private sector lenders fed the demand: These mortgage originators lend-to-sell-to-securitizers model had them holding mortgages for a very short period. This allowed them to relax underwriting standards, abdicating traditional lending metrics such as income, credit rating, debt-service history and loan-to-value.
Financial gadgets milked the market:
Lest We Forget: Why We Had A Financial Crisis - Forbes
"I made a mistake in presuming that the self-interests of organisations, specifically banks and others, were such that they were best capable of protecting their own shareholders and their equity in the firms," said Allan Greenspan.
Greenspan - I was wrong about the economy. Sort of | Business | The Guardian
WEIRD RIGHT?