Fallout continues from subprime mortgage ripoffs
Lewis DiuguidThe Justice Department did the right thing in getting Wells Fargo & Co. to agree to pay up to $175 million to settle allegations that it steered blacks and Hispanics into more expensive subprime mortages before the housing bust.
The Los Angeles Times reports that the “systemic discrimination” took place from 2004 through 2009 in Wells Fargo’s wholesale lending, which provided mortgages through independent brokers. The violations occurred in 36 states and the District of Columbia.
The ripoff of minorities seeking a piece of the American Dream comes as no surprise to African Americans and Latinos. The settlement will include $125 million being paid to borrowers who were victimized.
Wells Fargo will provide an additional $50 million in downpayment assistance to people in areas where the discrimination had a significant effect. To keep the systematic problem from recurring, Wells Fargo has agreed to monitoring and an internal review of its direct-to-consumer retail lending practices.
Thank goodness for the Obama Justice Department. Would it have happened under the Bush administration? I don’t think so.
Mark Hastert
10 months, 2 weeks ago“Why would anyone in the lending business proactively solicit and pursue purposely making loans that they NEW would very likely end up in default?”
Well Lucy, let me ‘splain it to you. It’s clear you’ve been misinformed. The folks making these loans and getting all the up front incentives by way of the yield spread and up front fees knew that they would be in the wind and never have to deal with the default. Read up on how the originators used to have “arts & crafts weekends” when the docs were doctored. Read up about liars loans. Read up on how, depending on your ethnicity you were offered certain loan products that others weren’t. It’s very well documented for anyone interested in the particulars. But it’s easier to just blame it all on Barney Frank. The fact is that deregulation and lax oversight, embraced by members of both parties, was at the root of this financial crisis. We made the loans too easy to get and the securities too easy to misrepresent.
You have a such predilection for bombast. Everything is “the most!, “the worst!” On what do you base you allegation that the Obama Justice Dept is the “the most corrupt, singularly mis focused, agenda driven “justice” department in our history”?
Why don’t you compare and contrast for us the Obama Justice Dept to that of say Nixon administration of maybe Taft, Harding? I’m sure you must have the data readily at hand and have studied the issue thoroughly.
Mark Hastert
10 months, 2 weeks ago“without the pressures that were applied by the legislators and their bureacratic enforcers”
Read more here: http://voices.kansascity.com/entries/fallout-continues-subprime-mortage-ripoffs/#storylink=cpy
You’ll have to be more specific. Did Barney walk in to Countrywide and order Angelo Mozillo to make liars loans, doctor the employment and credit verifications, coach applicants on how to game their FICO score? Did Fannie & Freddie coerce Citi to do the same? You see in those scenarios your original question would have some merit. Fannie & Freddie had to eat these bad loans so, no, they wouldn’t have encouraged anybody to make them. That would have been stupid but if, on the other hand as I said it was the mortgage originators and brokers instigating the loan practices it makes perfect sense. It was capitalism gone mad. Sometimes, Adam Smith’s invisible hand…. is picking your pocket.
Had the government coerced anybody it would a blockbuster expose’. I’m sure it would have been in all the papers especially since it happened during the Bush administration and the “lame stream media” was out to get him. Read up on all those things I mentioned It will open your eyes and your mind. But, like I said, it’s easier to blame Barney Frank.
George Hunsucker
Northland
10 months, 2 weeks agoearth to lewis #23…
Good to see you are not letting FACTS get in the way lewis… You need to read what was the cause of these crappy loans… One of your “brothers”, who ran Fannie was a main driver of this mess, Franklin Raines… look that us lewis and let us know….