MR

This guy is still talking. Interestingly enough, it was Greenspan who encouraged everyone to jump into adjustable rate mortgages about 5 years ago


http://money.aol.com/news/story/_a/us-e ... 5709990001


John from Boston

Can you believe that after 7 yrs of Bush's great economic decisions the tax payers are now having to bail out the banks that backed the loan companies that loaned the money that caused the housing boom that made the economic indicators look so good for the Bush economy?

I can. History repeats itself.

http://members.tripod.com/rationalrevol ... _the_s.htm

http://www.inthe80s.com/sandl.shtml

http://www.oldamericancentury.org/bushc ... family.htm

http://www.campaignwatch.org/more1.htm

Like I've said many times...The economy is not all wine and roses and Bush is partly to blame. Of course, since I agree with Bush on at least one issue, I'm just a Bush apologist anyway.

That little weasel Greenspan was the one who allowed the dot.com bubble to grow out of control and then when it crashed he lowered rates low enough & long enough to cause the housing bubble. Funny how he managed to sneak out the back door just before the shit hit the fan. Right before he left he was saying there was no bubble in housing. RIGHT!. Now Bernanke is stuck with this mess and everyone will blame it on him. In the meantime Greenspan trots around pretending he had nothing to do with it. That little fucker can kiss my ass.

MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

Funny how he speaks openly now. When he used to go before Congress he made cryptic remarks that were meant to be read between the lines. He made about as much sense as the Reverend Jim from "Taxi". Unfortunately, everyone had a different opinion of what was between the lines. Congress used to just scratch their heads and old Al just walked out of there none the worse for wear.

JrnyScarab wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

Funny how he speaks openly now. When he used to go before Congress he made cryptic remarks that were meant to be read between the lines. Unfortunately, everyone had a different opinion of what was between the lines. Congress used to just scratch their heads and old Al just walked out of there none the worse for wear.

Funny, that's the same affect he always had on me, in fact just reading this is making my head itch all over again....

Michigan Girl wrote:

JrnyScarab wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

Funny how he speaks openly now. When he used to go before Congress he made cryptic remarks that were meant to be read between the lines. Unfortunately, everyone had a different opinion of what was between the lines. Congress used to just scratch their heads and old Al just walked out of there none the worse for wear.

Funny, that's the same affect he always had on me, in fact just reading this is making my head itch all over again....

LOL!

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

JrnyScarab wrote:

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

They were thinking that with the economy the way it was, that even if they wrote loans to people with even zero credit, the value of the house would increase enough to more than cover any losses if they defaulted.

JrnyScarab wrote:

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

Because they are idiots.

JrnyScarab wrote:

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

The Feds claimed that people were being "discriminated against by the Evil Mortgage Lenders"...

It's everyone's right to own a home, didn't you know...

Rick wrote:

JrnyScarab wrote:

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

They were thinking that with the economy the way it was, that even if they wrote loans to people with even zero credit, the value of the house would increase enough to more than cover any losses if they defaulted.

Yeah, house prices NEVER fall you know. It wasn't that long ago that they fell. I know because I bought a condo cheap in the 90's after the last fall. And these are our leaders you say?

conversationpc wrote:

JrnyScarab wrote:

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

Because they are idiots.

No argument there!

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Pressure possibly...but they didn't HAVE to go that route. No one can tell you how to run your company as long as you are conducting business within the guidelines provided by each investor. We were under constant scrutiny by our local realtors, but we did what was best for the customer. FNMA, GNMA, FHLMC etc. have no problems with the way we choose to conduct business and do not try to alter our business making decisions.

Rick wrote:

JrnyScarab wrote:

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

They were thinking that with the economy the way it was, that even if they wrote loans to people with even zero credit, the value of the house would increase enough to more than cover any losses if they defaulted.

That sounds logical, but the mortgage companies do not OWN the homes the investors do. So once a loan is defaulted on and goes into foreclosure, the majority of the loss is passed on to the investor and the PMI companies. If there is no PMI insurance intact, that loss is passed on to the mortgage company. There is NEVER a profit for the mortgage company in a foreclosure situation NO MATTER what the value of the home might be. We incur legal fees etc. and lose credibility w/the investors. If the servicing agreement is pulled as a result, we are SOL!!! The HUD homes you see for sale are put on the market by the investor, usually under market value just to unload it ASAP!!

Michigan Girl wrote: The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!!

While I definitely agree with you that the current credit and housing crisis is "sad", I'm not willing to blame mortgage companies or politicians for the downfall of the housing market. It's clear from your later comments in this thread that you work in the industry, and have industry knowledge. I also have worked in the mortgage industry for years, and ran my own company for years. The bottom line for me is that the American home buyer MUST be held accountable. I simply don't and NEVER will buy into "Consumers weren't told what their loans were"! That is the most ridiculous excuse I've ever heard!

I've NEVER signed a single document, without understanding what it was I was signing (including before I got into the industry)! It is simply inexcusable for any homeowner to say they didn't know that their mortgage rate could adjust! The freakin term "ARM" acronymn has "Adjustable" right in there! Also, there isn't a state that I'm aware of that doesn't require both the lender and broker to have the borrower sign an adjustable rate disclosure with warning after warning after warning! They then have to sign an adjustable rate rider with the mortgage, at the closing! If the borrower chooses not to read what it is he or she is signing, they have nobody to blame, but themselves!

Most people in our industry knew the bottom was going to fall out, when banks were offering 100% financing to VERY marginal borrowers. Most people with an ounce of common sense also knew that eventually the price of real estate was going to start going the other way, and it finally has! I don't see the prices of real estate bouncing back any time soon. I also think the foreclosure rate is going to continue to climb over the next 12-18 months, because we are nowhere near the bottom of this disaster!


John from Boston

conversationpc wrote:Like I've said many times...The economy is not all wine and roses and Bush is completely to blame. Of course, since I agree with Bush on at least one issue, I'm just a Bush apologist anyway.

I corrected your statement for you....

In all seriousness, you are correct in that the economy is a fluid thing... hundreds of factors have lasting effects. HOWEVER, and jumping back to the above statement.... George W Bush has done such a tremendous amount of damage to our economy that every other possible factor pales in comparison to the negative contributions hayseed George has made.

strangegrey wrote:

conversationpc wrote:Like I've said many times...The economy is not all wine and roses and Bush is completely to blame. Of course, since I agree with Bush on at least one issue, I'm just a Bush apologist anyway.

I corrected your statement for you....

In all seriousness, you are correct in that the economy is a fluid thing... hundreds of factors have lasting effects. HOWEVER, and jumping back to the above statement.... George W Bush has done such a tremendous amount of damage to our economy that every other possible factor pales in comparison to the negative contributions hayseed George has made.

I disagree...The lame excuses for "Representatives" and "Senators" are just as equally to blame.

conversationpc wrote:I disagree...The lame excuses for "Representatives" and "Senators" are just as equally to blame.

Meh, I disagree.....Those 'representatives' and 'senators' cant do dick without a signature of a so-called "President"....

JrnyScarab wrote:

conversationpc wrote:

Michigan Girl wrote:MMMHHMMM!!!!Many mortgage companies and lenders, (think Countrywide) have suffered as a result and they have no one to blame but themselves. Any lender that could not see the insanity in Greenspan's statements didn't do their research nor did they care about anything except the almighty dollar. ARM loans were designed for a few very specific purposes and lenders were throwing them out there to anyone who could remotely qualify. The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!! That being said...it's nice that he realizes the state of our economy.

I think politicians are far more to blame than the mortgage companies. They were put under pressure by the federal government to hand out high risk loans to people who shouldn't have had them in the first place.

Why did the Feds pressure the mortgage lenders? What were they thinking?

That they had to make the economic indicators look good while Bush and Cheney raped the real economy of the country.

strangegrey wrote:

conversationpc wrote:I disagree...The lame excuses for "Representatives" and "Senators" are just as equally to blame.

Meh, I disagree.....Those 'representatives' and 'senators' cant do dick without a signature of a so-called "President"....

Very true...Bush hasn't found the veto pen very often, has he?

conversationpc wrote:

strangegrey wrote:

conversationpc wrote:I disagree...The lame excuses for "Representatives" and "Senators" are just as equally to blame.

Meh, I disagree.....Those 'representatives' and 'senators' cant do dick without a signature of a so-called "President"....

Very true...Bush hasn't found the veto pen very often, has he?

Only when he does damage...

Enigma869 wrote:

Michigan Girl wrote: The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!!

Enigma869 wrote:While I definitely agree with you that the current credit and housing crisis is "sad", I'm not willing to blame mortgage companies or politicians for the downfall of the housing market. It's clear from your later comments in this thread that you work in the industry, and have industry knowledge. I also have worked in the mortgage industry for years, and ran my own company for years. The bottom line for me is that the American home buyer MUST be held accountable. I simply don't and NEVER will buy into "Consumers weren't told what their loans were"! That is the most ridiculous excuse I've ever heard!

You are absolutely correct...If I implied that the consumers were completely unaware, I certainly didn't mean to. Trust me they are being held accountable, as they should.

Enigma869 wrote:I've NEVER signed a single document, without understanding what it was I was signing (including before I got into the industry)! It is simply inexcusable for any homeowner to say they didn't know that their mortgage rate could adjust! The freakin term "ARM" acronymn has "Adjustable" right in there! Also, there isn't a state that I'm aware of that doesn't require both the lender and broker to have the borrower sign an adjustable rate disclosure with warning after warning after warning! They then have to sign an adjustable rate rider with the mortgage, at the closing! If the borrower chooses not to read what it is he or she is signing, they have nobody to blame, but themselves!

Once again, CORRECT. disclosure statements are signed for EVERYTHING....including the fact that the loan has an ADJUSTABLE RATE. of course these people know their loan is an ARM loan. I too, have never signed a document that I did not completely understand, however, knowing that your mortgage pmt. WILL change from year to year and knowing the possible extent of that change are two different things. It is OUR responsibilty to point out those possibilities the good and BAD. Whether we like it or not, not ALL people completely understand the never ending load of shit that they are signing as they shake their heads. Again, in the underwriting process, it is our responsibility to make sure that the product will be affordable in the long haul...do we have crystal balls? The answer would have to be NO...so we go with the information that is provided. This is where I would say, NO I cannot approve this loan, I am sorry. But that doesn't stop JOE BLOW down the street from approving the exact same loan we declined. Is it his fault that these idiots were already told NO and then came to him...once again, no. Did he do anything illegal, NO, because the standards have been reduced to such a level that these people DO in fact qualify. But they can't afford it. Who's at fault....the consumer because they want what they REALLY can't afford. The difference is we cared enough to inform COMPLETELY..lose the business and STAY in business....unlike Countrywide.

Enigma869 wrote:Most people in our industry knew the bottom was going to fall out, when banks were offering 100% financing to VERY marginal borrowers. Most people with an ounce of common sense also knew that eventually the price of real estate was going to start going the other way, and it finally has! I don't see the prices of real estate bouncing back any time soon. I also think the foreclosure rate is going to continue to climb over the next 12-18 months, because we are nowhere near the bottom of this disaster! John from Boston

TRUE....this is why we didn't fall for the reduced standards, chose to turn away business and profit margin for the life of the company. Our FC rate is low and we still work with our ethics intact. However, it doesn't change the fact that I am sad that NOT ALL companies explain in full the specifics of the ARM loan...it was designed to be helpful to the consumer in just a VERY FEW instances and that may NOT apply to you

Enigma869 wrote:

Michigan Girl wrote: The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!!

While I definitely agree with you that the current credit and housing crisis is "sad", I'm not willing to blame mortgage companies or politicians for the downfall of the housing market. It's clear from your later comments in this thread that you work in the industry, and have industry knowledge. I also have worked in the mortgage industry for years, and ran my own company for years. The bottom line for me is that the American home buyer MUST be held accountable. I simply don't and NEVER will buy into "Consumers weren't told what their loans were"! That is the most ridiculous excuse I've ever heard!

I've NEVER signed a single document, without understanding what it was I was signing (including before I got into the industry)! It is simply inexcusable for any homeowner to say they didn't know that their mortgage rate could adjust! The freakin term "ARM" acronymn has "Adjustable" right in there! Also, there isn't a state that I'm aware of that doesn't require both the lender and broker to have the borrower sign an adjustable rate disclosure with warning after warning after warning! They then have to sign an adjustable rate rider with the mortgage, at the closing! If the borrower chooses not to read what it is he or she is signing, they have nobody to blame, but themselves!

Most people in our industry knew the bottom was going to fall out, when banks were offering 100% financing to VERY marginal borrowers. Most people with an ounce of common sense also knew that eventually the price of real estate was going to start going the other way, and it finally has! I don't see the prices of real estate bouncing back any time soon. I also think the foreclosure rate is going to continue to climb over the next 12-18 months, because we are nowhere near the bottom of this disaster!


John from Boston

I agree with you 110%, John! People got into these mortgages of their own free will. If they didn't understand what they were getting into, they shouldn't have signed the papers or they should have kept asking questions until they DID understand and were OK with it. Nobody held a gun to their heads and told them they must make poor financial decisions. I sometimes have difficulty understanding the money aspect of the loans (my math sucks), but I'll keep asking questions until I understand it and I don't care who I piss off.

Honestly, Greenspan needs to shut his piehole. The markets are still affected by the things he says. I truly believe that we're just beginning to pay for all of the "feel good" mistakes that were made by companies, the fed, and the legislators in the late '90s and early '00s. What goes up must come down...

The other piece of all this that needs to be looked at is how these companies bought up all the loans, turned them into marketable securities, and sold them with little oversight, by either their own internal auditors or the government.

What pushed this WHOLE thing, on all sides was GREED. (Excuse the generalizations to come please)

Greedy consumer who just had to have that big house on the hill that was just a little better than the Jones, whether they could aford it or not one the ARM reset.

The Greedy real estate person who would do anything to get houses sold, including buying off appraisers to inflate the value of the homes so L to V ratios looked good.

The greedy mortgage company that would do anything to get people into a mortgage, even if they couldn't aford it.

And the WORST of the lot...the Greedy speculator who bought up all the securities backed by the now almost worthless mortgages.

The ONLY place you can blame the government for this is at the last level. They didn't watch these banks who were buying up all the mortgages to package them and sell them as securities. The government figured that the internal auditiing processes of these people would catch anything bad going on. They were wrong...DUH??? ENRON ANYONE???

What I don't get though, and perhaps someone here could explain it. The banks had an easy way out, they could have rewrote the mortgages when everything started to blow up. Given a good rate, and made it fixed. Sure they would have lost FUTURE interest, and some of the bundled securities would have returned a slightly lower interest rate, but it would have solidified the housing market and kept the bubble from bursting.

But the bubble has burst but you cannot blame anyone well...except EVERYONE who sought to line their own pockets on other peoples stupidity.

jrnychick wrote:

Enigma869 wrote:

Michigan Girl wrote: The victims (in most cases) are the people losing their homes because their LENDER did not explain SPECIFICALLY how an ARM loan works over the life of the loan. Sad indeed!!

While I definitely agree with you that the current credit and housing crisis is "sad", I'm not willing to blame mortgage companies or politicians for the downfall of the housing market. It's clear from your later comments in this thread that you work in the industry, and have industry knowledge. I also have worked in the mortgage industry for years, and ran my own company for years. The bottom line for me is that the American home buyer MUST be held accountable. I simply don't and NEVER will buy into "Consumers weren't told what their loans were"! That is the most ridiculous excuse I've ever heard!

I've NEVER signed a single document, without understanding what it was I was signing (including before I got into the industry)! It is simply inexcusable for any homeowner to say they didn't know that their mortgage rate could adjust! The freakin term "ARM" acronymn has "Adjustable" right in there! Also, there isn't a state that I'm aware of that doesn't require both the lender and broker to have the borrower sign an adjustable rate disclosure with warning after warning after warning! They then have to sign an adjustable rate rider with the mortgage, at the closing! If the borrower chooses not to read what it is he or she is signing, they have nobody to blame, but themselves!

Most people in our industry knew the bottom was going to fall out, when banks were offering 100% financing to VERY marginal borrowers. Most people with an ounce of common sense also knew that eventually the price of real estate was going to start going the other way, and it finally has! I don't see the prices of real estate bouncing back any time soon. I also think the foreclosure rate is going to continue to climb over the next 12-18 months, because we are nowhere near the bottom of this disaster!


John from Boston

I agree with you 110%, John! People got into these mortgages of their own free will. If they didn't understand what they were getting into, they shouldn't have signed the papers or they should have kept asking questions until they DID understand and were OK with it. Nobody held a gun to their heads and told them they must make poor financial decisions. I sometimes have difficulty understanding the money aspect of the loans (my math sucks), but I'll keep asking questions until I understand it and I don't care who I piss off.

Honestly, Greenspan needs to shut his piehole. The markets are still affected by the things he says. I truly believe that we're just beginning to pay for all of the "feel good" mistakes that were made by companies, the fed, and the legislators in the late '90s and early '00s. What goes up must come down...

People do get into these mortgages of their own free will however, by maintaining responsibility on OUR end means our company may be here tomorrow to service your mortgage needs!!! We can blame the consumer all we want for their lack of knowledge and their inablility to make sound financial decisions, but we have to make sound financial decisions as well if we are going to remain in business~sometimes that means saying NO!!!! Look, it's as simple as this...do you want to go bankrupt or not? If you choose yes, go ahead make the loans and continue to call other people irresponsible because YOUR business went under.

RossValoryRocks wrote:The other piece of all this that needs to be looked at is how these companies bought up all the loans, turned them into marketable securities, and sold them with little oversight, by either their own internal auditors or the government.

What pushed this WHOLE thing, on all sides was GREED. (Excuse the generalizations to come please)

Greedy consumer who just had to have that big house on the hill that was just a little better than the Jones, whether they could aford it or not one the ARM reset.

The Greedy real estate person who would do anything to get houses sold, including buying off appraisers to inflate the value of the homes so L to V ratios looked good.

The greedy mortgage company that would do anything to get people into a mortgage, even if they couldn't aford it.

And the WORST of the lot...the Greedy speculator who bought up all the securities backed by the now almost worthless mortgages.The ONLY place you can blame the government for this is at the last level. They didn't watch these banks who were buying up all the mortgages to package them and sell them as securities. The government figured that the internal auditiing processes of these people would catch anything bad going on. They were wrong...DUH??? ENRON ANYONE???

What I don't get though, and perhaps someone here could explain it. The banks had an easy way out, they could have rewrote the mortgages when everything started to blow up. Given a good rate, and made it fixed. Sure they would have lost FUTURE interest, and some of the bundled securities would have returned a slightly lower interest rate, but it would have solidified the housing market and kept the bubble from bursting.

But the bubble has burst but you cannot blame anyone well...except EVERYONE who sought to line their own pockets on other peoples stupidity.

WOW!!!...and I thought you only knew music!!!!

When did this board become a goddamn watercooler?