Sunday, September 28, 2008

Mortgage Crisis--One True Cause Ignored

The mortgage crisis that is actually not much of a crisis if measured by foreclosures--about 1%--and is a crisis if measured by people that were screwed into non-fixed mortgages--ARMs (adjustable-rate mortgages)--and are in danger of losing their investment--was caused by all sorts of greed. But let's take a look at what that means, for real.

In Texas, visit and type in your Texan city or county of choice. (After it loads, use the arrow to view results on same page.) This page is part of the Texas Department of Savings and Mortgage Lending: and will list all of the tons of unlicensed (and very few legitimate ones who are) mortgage brokers, loan officers, entity mortgage brokers, mortgage bankers and financial services who advertise themselves as all of the above and shamelessly have their licenses expired, or never got a license, but applied.

Where the hell's the regulation? Where's the attorneys general across the state and country doing simple searches in their own jurisdiction and going after these greedy SOBs who are falsely advertising themselves as legitimate mortgage and loan purveyors, some of them even publishing their license numbers, expired as they know they are, etc.? Where's the advertising departments of newspapers and real estate guides publishers doing their homework and making sure the "lenders" are licensed? This lack of effort by publishers is one reason for loss of newspaper readership.

Even folks from Lending, etc., are guilty of this. Some person in their company at one point was licensed and that's supposed to be enough?

Yes, the large companies that buy up these contracts--the same ones that offer bonuses to these primarily unlicensed lenders for jacking up the annual percentage rates (APR) on the folks buying houses out there--are largely responsible. Let's go after them. But let's not ignore these, our neighbors and friends who, being local, and knowing the locals, are screwing their own neighbors.

Time and again the local and national news media, attorneys general, and legislators have been ignoring this core issue. It's easy to identify, easy to prove, easy to prosecute, easy to stop.

"Newsweek" has yet again one of these "how did this happen" stories out about the background of the bailout. Yet, it's those in the arena, those who are actually signing those papers, telling the big companies that Joe Schmuckatelli in front of them has enough income to make the payments--knowing he doesn't, but jacking up the numbers, selling Joe Schmuckatelli on higher interest rates and ARMs, that is largely to blame.

Let's go after them, too. That's the damned story!


Mortgage Modification said...

Although a loan does not start out as income to the borrower, it becomes income to the borrower if the borrower is discharged of indebtedness.

Joseph Aldeguer said...

Make sure to know the state of your finances before contacting your lender. Determine how much income you're bringing in each month, how much you're paying in bills and where you can cut costs. Just a tip!