Comments on: Guest Post: The Front Lines http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/ #1 Free Home Loan Modification & Debt Relief Help For US Home Owners - Truths, Facts & News About the Mortgage Industry Sat, 07 Nov 2009 02:53:18 -0700 http://wordpress.org/?v=2.8.3 hourly 1 By: S Hallman http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4065 S Hallman Fri, 14 Sep 2007 12:18:02 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4065 Chase Wholesale just discontinued ALT A Flex no ratio and no doc loans yesterday. The job of a lender is making sure that the borrower has the ability to repay - no ratio and no doc were not fraudulent (legit products offered by the market place) but they certainly don't provide evidence of ability to repay! I'm no saint but saying pressure to perform is a rationalization and the proper response by Nick would have been to quit not justify fraudulent behavior by shifting greed as solely the sin of the employer. Chase Wholesale just discontinued ALT A Flex no ratio and no doc loans yesterday. The job of a lender is making sure that the borrower has the ability to repay – no ratio and no doc were not fraudulent (legit products offered by the market place) but they certainly don’t provide evidence of ability to repay! I’m no saint but saying pressure to perform is a rationalization and the proper response by Nick would have been to quit not justify fraudulent behavior by shifting greed as solely the sin of the employer.

]]> By: David http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4056 David Fri, 14 Sep 2007 04:07:01 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4056 Hey, As a former Regional Manager and Loan officer for 3 major lenders in the past six years, the responsibility always falls on the loan officer who is dealing directly with the client to advise him or her on the best products that our availible and the pros and con to them all so they, not you can make an informed choice. The business models that were set up could not last forever because housing values could not continue to rise fast enough for people to refinance every 2 to 3 years. This mess could not have been avoided because wages have not increased for the middle class and the distance between the rich and the poor keeps growing. The 3rd quarter will shake out all the fluff in the industry and what was done in the dark will come to light. Hey,

As a former Regional Manager and Loan officer for 3 major lenders in the past six years, the responsibility always falls on the loan officer who is dealing directly with the client to advise him or her on the best products that our availible and the pros and con to them all so they, not you can make an informed choice. The business models that were set up could not last forever because housing values could not continue to rise fast enough for people to refinance every 2 to 3 years. This mess could not have been avoided because wages have not increased for the middle class and the distance between the rich and the poor keeps growing. The 3rd quarter will shake out all the fluff in the industry and what was done in the dark will come to light.

]]> By: ZB http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4044 ZB Thu, 13 Sep 2007 22:55:35 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4044 To believe that the author's post was an indictment of all LO's, originators, brokers, processors, etc. is exceedingly base. Scott's belief that the "post was just one aspect of [what] went wrong in the industry" is spot on. Everyone can agree that at best, very suspect lending practices were engaged in during the money-lending hey-day and at worst, highly fraudulent and illegal things were done in order to fund loans. I think we all know that on that spectrum it's leaning toward the latter. People can holler, "I've been in the lending business XX years and have funded XXXX number of loans" all they want. Does that change the fact that a percentage (one that is impossible to determine, I might add) of the industry misled borrowers, lied, doctored documents, and generally engaged in ethically reprehensible activity? No, it doesn't. It simply means that there are people out there who sullied the reputation of a once honest business. Furthermore, the article isn't titled "How All AE's and LO's Intentionally Misled Millions of Borrowers." It's talking about how a little cancer penetrated the system and managed to cripple it. I've known many ethical and upstanding originators and AEs. I've also known many who can't claim that. This website is designed to shed light on the seedy underbelly of the mortgage industry; it's not for the sake of orignators and people in the industry, but for the consumer who feels like they were bent over the barrel. I, for one, think that the article should go back up. The more knowledge a consumer has when purchasing or refinancing a home, the less likely it is that dishonest broker shops and lenders will stay in business. To believe that the author’s post was an indictment of all LO’s, originators, brokers, processors, etc. is exceedingly base. Scott’s belief that the “post was just one aspect of [what] went wrong in the industry” is spot on.

Everyone can agree that at best, very suspect lending practices were engaged in during the money-lending hey-day and at worst, highly fraudulent and illegal things were done in order to fund loans. I think we all know that on that spectrum it’s leaning toward the latter.

People can holler, “I’ve been in the lending business XX years and have funded XXXX number of loans” all they want. Does that change the fact that a percentage (one that is impossible to determine, I might add) of the industry misled borrowers, lied, doctored documents, and generally engaged in ethically reprehensible activity? No, it doesn’t. It simply means that there are people out there who sullied the reputation of a once honest business.

Furthermore, the article isn’t titled “How All AE’s and LO’s Intentionally Misled Millions of Borrowers.” It’s talking about how a little cancer penetrated the system and managed to cripple it. I’ve known many ethical and upstanding originators and AEs. I’ve also known many who can’t claim that.

This website is designed to shed light on the seedy underbelly of the mortgage industry; it’s not for the sake of orignators and people in the industry, but for the consumer who feels like they were bent over the barrel.

I, for one, think that the article should go back up. The more knowledge a consumer has when purchasing or refinancing a home, the less likely it is that dishonest broker shops and lenders will stay in business.

]]> By: admin http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4040 admin Thu, 13 Sep 2007 20:27:38 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4040 <p>just letting any comment followers know that the guest author requested to have the post remove as they felt it was being misconstrued. I have honored that request. If you have any questions you can email me directly. While i don't remove comments i do homor requests from any authors that are kind enough to contribute. </p> <p>The reason the post went up was that i opened the blog up for guest commentary and i thought that the posts i received were all interesting and important to add to our conversation here. I do not have any tolerance for fraud but the scary state of our industry is that there is case after case of fraud on all levels. Of course this is not to say that the entire industry engaged in it but unfortunately it has been my experience through accounts such as this one that fraud has been wide spread. Morgan</p> just letting any comment followers know that the guest author requested to have the post remove as they felt it was being misconstrued. I have honored that request. If you have any questions you can email me directly. While i don’t remove comments i do homor requests from any authors that are kind enough to contribute.

The reason the post went up was that i opened the blog up for guest commentary and i thought that the posts i received were all interesting and important to add to our conversation here. I do not have any tolerance for fraud but the scary state of our industry is that there is case after case of fraud on all levels. Of course this is not to say that the entire industry engaged in it but unfortunately it has been my experience through accounts such as this one that fraud has been wide spread. Morgan

]]> By: Scott http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4037 Scott Thu, 13 Sep 2007 19:27:46 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4037 I think the point of this post is just one aspect of went wrong in the industry. Why are you bashing the author. He was simply stating what went on. This information isn't breaking news. Everyone knows about it. And he didn't say everyone did it. He just mentioned instances of bad stuff taking place. And it's not just the AEs, or the lender, it's also the borrowers who cooperated. There is no ONE entity to blame here folks, that's the point. I think the point of this post is just one aspect of went wrong in the industry. Why are you bashing the author. He was simply stating what went on. This information isn’t breaking news. Everyone knows about it. And he didn’t say everyone did it. He just mentioned instances of bad stuff taking place.

And it’s not just the AEs, or the lender, it’s also the borrowers who cooperated. There is no ONE entity to blame here folks, that’s the point.

]]> By: Therealtruth http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4036 Therealtruth Thu, 13 Sep 2007 18:08:03 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4036 Jag, Another misleading post... The media tends to oversensationalize the vitimized borrower and the truth of the matter is that is simply is not accurate. All of the Alt-A and subprime players had longer fixed periods available to these borrowers with no extra compensation for the AE to sell one over the other. These borrowers wanted the lower payment and larger homes which will work as long as the property values increase, and looking at historical data at the time, there was a comfort level that it would continue. It was ultimately the borrower who made the decision to go with the lower payment, and everyone in the industry knows the amount of disclosures that have to be signed at closing warning consumers about the adjustment periods. The 2 and 3 year fixed was an important loan for many first time homebuyers historically which gave the borrower a lower than market rate for the initial term with the purpose of refinancing 2 to 3 years down the road into a fixed rate. A number of these borrowers were buying starter homes which needed some fixing up and they needed all of their cash available. Anyway, it is obvious to all now that the crash of the housing market could have been forecasted, then the industry would have obviously discontinued the 2 and 3 year fixed for these borrowers. Jag,
Another misleading post… The media tends to oversensationalize the vitimized borrower and the truth of the matter is that is simply is not accurate. All of the Alt-A and subprime players had longer fixed periods available to these borrowers with no extra compensation for the AE to sell one over the other. These borrowers wanted the lower payment and larger homes which will work as long as the property values increase, and looking at historical data at the time, there was a comfort level that it would continue. It was ultimately the borrower who made the decision to go with the lower payment, and everyone in the industry knows the amount of disclosures that have to be signed at closing warning consumers about the adjustment periods. The 2 and 3 year fixed was an important loan for many first time homebuyers historically which gave the borrower a lower than market rate for the initial term with the purpose of refinancing 2 to 3 years down the road into a fixed rate. A number of these borrowers were buying starter homes which needed some fixing up and they needed all of their cash available. Anyway, it is obvious to all now that the crash of the housing market could have been forecasted, then the industry would have obviously discontinued the 2 and 3 year fixed for these borrowers.

]]> By: Rino http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4035 Rino Thu, 13 Sep 2007 18:01:58 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4035 I forwarded the article to the Attorney General I forwarded the article to the Attorney General

]]> By: Bryant Keefe http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4033 Bryant Keefe Thu, 13 Sep 2007 16:59:16 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4033 Wow! Is this post for real? What a cheater. I have been lending for 4 years and spent 9 years selling houses prior to that and did not ever find this the "norm". I hope this individual and his crooked peers get plenty of jail time and big civil penalties. I cannot imagine this author can sleep very well waiting for the Feds to show up. Good luck! Wow! Is this post for real? What a cheater. I have been lending for 4 years and spent 9 years selling houses prior to that and did not ever find this the “norm”. I hope this individual and his crooked peers get plenty of jail time and big civil penalties.

I cannot imagine this author can sleep very well waiting for the Feds to show up. Good luck!

]]> By: JAG http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4032 JAG Thu, 13 Sep 2007 16:33:41 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4032 TheRealTruth - It is really not as simple as that. The whole point of the post, in my opinion, is to realize that things were so out of hand; that even having "controls" all over the place didn't help. In addition, I think that it WAS the norm at some companies. You seem to be well-established in your career; however, there are lots of little companies out there trying to make it; and a lot of "kids" basically get hired by these companies to do this sort of thing. I see your perspective; however, It's obvious this was happening especially from no-doc loan originators. --The housing market is FEELING - it right now; and that is why we have such a credit crisis. The investors; DON'T believe they will get paid back and that they CAN'T trust the paper. Simple as that; and when that happens. BOOM! Watch out below. Maybe this isn't the NORM; but it sure is not a minority of loans that have been originated in the last 2 years; because go look at the option/arm, i/o, ARM reset period graphs, and you can't tell me you don't have a little fear over what is about to happen come October when a TON of arms reset HIGHER. These loans basically came from; okay you can't afford or you don't want a 30 year fixed; bam; your payments lower for two years with this suicideloan making it affordable. OOPS. You're house stopped appreciating and you can't refinance out of it?! Like I said before; look out below. TheRealTruth – It is really not as simple as that.

The whole point of the post, in my opinion, is to realize that things were so out of hand; that even having “controls” all over the place didn’t help. In addition, I think that it WAS the norm at some companies. You seem to be well-established in your career; however, there are lots of little companies out there trying to make it; and a lot of “kids” basically get hired by these companies to do this sort of thing. I see your perspective; however, It’s obvious this was happening especially from no-doc loan originators. –The housing market is FEELING – it right now; and that is why we have such a credit crisis. The investors; DON’T believe they will get paid back and that they CAN’T trust the paper. Simple as that; and when that happens. BOOM! Watch out below.

Maybe this isn’t the NORM; but it sure is not a minority of loans that have been originated in the last 2 years; because go look at the option/arm, i/o, ARM reset period graphs, and you can’t tell me you don’t have a little fear over what is about to happen come October when a TON of arms reset HIGHER.

These loans basically came from; okay you can’t afford or you don’t want a 30 year fixed; bam; your payments lower for two years with this suicideloan making it affordable. OOPS. You’re house stopped appreciating and you can’t refinance out of it?!

Like I said before; look out below.

]]> By: therealtruth http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/comment-page-1/#comment-4031 therealtruth Thu, 13 Sep 2007 15:16:45 +0000 http://blownmortgage.com/2007/09/12/guest-post-the-front-lines/#comment-4031 How did this story get published on the website? This AE was involved in criminal activity and was not the norm in the marketplace. Every lender that I had worked at (and that was many), completed the Verbal VOE at funding to ensure that the borrower's employment was valid, not to find a way to sell the loan to the investor. There were, however, as in every sector companies that were involved in unethical activity, but this story is written as if this activity was the norm. The simple truth is that it wasn't..... The norm in the industry with all of was to put these controls in place to protect the lenders from fraud. It is as simple as that... How did this story get published on the website? This AE was involved in criminal activity and was not the norm in the marketplace. Every lender that I had worked at (and that was many), completed the Verbal VOE at funding to ensure that the borrower’s employment was valid, not to find a way to sell the loan to the investor. There were, however, as in every sector companies that were involved in unethical activity, but this story is written as if this activity was the norm. The simple truth is that it wasn’t….. The norm in the industry with all of was to put these controls in place to protect the lenders from fraud. It is as simple as that…

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