"So they have this lady on who made $1600 per month, and she figured she could get a $250,000 mortgage that cost her $2100 per month. She says "It's not my fault because they told me I could afford it!" HOW IN THE FUCK DO YOU PLAN TO AFFORD IT DUMB ASS? Did you flunk 2nd grade math?" What about the query she poses - "its not my fault because they told me I could afford it". We know that it was told to her - go ahead and take the money!! How come none of these reporters, government regulators have gone to that mortgage broker who approved the loan and asked him/her - "Did you flunk 2nd grade math? What made you think you could give her a 250K mortgage"
Exactly, unless you are classified as legally having a major mental handicap...there is no excuse for such stupidity.
what's more stupid?? her making $1600 and taking a $2500 a month loan or the bank loaning her the $2500/month loan when she only put down $1600 on her application?.....
The only thing screwed-up is you brain. What was going on between the mortgage brokers, originators and Wall Street was outright fraud on an epic level.
Mortgage brokers and banks are two different parties. I seriously doubt the bank itself was changing her reported income. Mortgage brokers did make shit up, I don't deny that. But, at the end of the day it is still the buyers responsibility to say "gee whiz the mortgage payment is more than twice my monthly gross...nope prolly can't afford this one". But, since you mentioned it...I was a mortgage loan officer and trust me...people lie their fucking asses off on mortgage apps. We didn't have a subprime program where I used to work. We were turning down loans all damn day. It was funny, because you'd see someone's account that had recently applied for a mortgage with you...then in their history a few days after being declined they were requesting a VOD to be send to some shady ass mortgage company to get a loan they were unqualified for in the first place. You had to have a 780 Beacon score to qualify for no doc. Needless to say, the company I used to work for isn't having any mortgage problems, and yes...they are an extremely large entity and very well capitalized. So....don't act as if people were being honest and putting down all the correct info and the mean old banks were changing it just so they could fuck themselves by giving a mortgage to a grossly unqualified borrower. It takes two to tango. The banks should have verified the info, the people shouldn't have been making shit up. When you get a mortgage you receive documents that you must sign to close on the loan. In those documents, everything about your mortgage is included (rate adjustments, interest only periods, etc). Regardless of who said or did what- if you sign off on a business transaction for hundreds of thousands of dollars without reading the contract you are an idiot. Period. If the terminology in the contract is too dense, pay an attorney $250 bucks to read it for you. Surely you can afford $250 for a lawyer if you are buying a $600,000 house...right?
You did hear her say that she was planning on paying the loan by having a sister move in with her correct? That means you only have half the income equation factored in. Similarly, you did hear her say that the income listed on her application was wrong as put in by the specialist. Was this lady at fault to some degree - certainly. But then again, she admits she was near homeless so we are not talking genius here. The fact that somebody gave a loan of this size to a homeless person is the real crime here. The report is factual in that the specialist just wanted the Commission.
Her application did not say $1600/month it said $7500/month. The specialist changed the numbers to make the loan work. She didn't know it said $7500 until Dateline approached her on it.
...the best laid plans of mice and men.... SHE STILL SIGNED THE MORTGAGE DOCS, PATCHIE. THE MORTGAGE DOCS SPELL OUT EVERY SINGLE THING ABOUT THE MORTGAGE YOU COULD POSSIBLY ASK FOR. IF THEY DIDN'T SHE WOULDN'T BE LEGALLY OBLIGATED TO PAY THE LOAN AS IT WOULD BE CONSIDERED NULL AND VOID. SHE STILL SIGNED THE DOCS, PATCHIE. THANKS. P.S. Oh and don't forget, it's easy to make lies and excuses after the fact as to why something isn't your fault.