(Chuckles under breathe.)

Before applying for the loan, I heard about all of these loans where they don’t document anything, and I had a hard time believing it after our experience. Our lender needed documentation on anything and everything, including proof that certain credit cards were paid off, what apartments I lived in and for how long (almost four years ago), etc. Perhaps they needed to look so closely because my, and my wife’s, credit are excellent.

Hening on September 25, 2008 at 5:35 PM

I worked as a mortgage loan officer from 2003-2007. The only people that got No Income/No Asset loans were people who had squeaky clean credit. People with crappy credit had to prove their income or at least that they were employed.

I think the real problem is that they gave people with crappy credit 100% financing deals and told them to refinance two years down the road. During those two years, those people were supposed to work on their credit so they could get a non-subprime loan to replace it. It was assumed that the house’s value would increase and the closing costs on the refinance could be rolled in. When the bottom dropped out of housing prices, people couldn’t do this and found themselves with a payment that shot through the roof.

I’ll also bet that a lot of these defaulted loans happened on investment properties. People with crappy credit were given 90-95% financing on those properties as well. At that loan-to-value, you could not charge enough rent to cover the mortgage payment, taxes, and insurance, especially if the property went unoccupied for a couple of months.

Also, nobody was given a low interest rate. People with crappy credit were paying 2-4% more than those with good credit. I assumed the lenders did this as a type of insurance policy to cover the higher number of defaults. I guess I was wrong.

Just scrape off the scum and move on with the brewing process.

O’Neill has been asked by the Obama campaign “on several occasions” to take part in conversations with the candidate on the economy with the understanding that his participation doesn’t represent an endorsement. He said he would be willing to offer the same help to McCain but hasn’t been asked.

Well, DUH.
That right there is enough to vote for McCain. Obama has surrounded himself with these losers and creators of finance disaster. Only Buffet has any cred.

Breaking on CNBC: McCain says THIS deal is dead.

TheBigOldDog on September 25, 2008 at 5:57 PM

Now maybe the dems will pass the bailout without Republican votes, just to prove McCain wrong.

I can’t recall a single time where this jackass didn’t make me squirm.

taznar on September 25, 2008 at 5:54 PM

Similar experience last year. When I moved to Florida from Kansas in ’01, I gave them my name and SSN, then signed papers at closing. Moved from Bonita Springs, FL to Cape Coral, FL in ’05. Just told my current mortgage company what I wanted to do… that was it. Then signed papers at closing. Did a re-fi last September. That time, I was subjected to a full body cavity and then they wanted to measure my johnson because I put down a number that was a 1/4″ different that a brag I made on an Internet site 3 years ago…. Things have tightened up a bit.

CC

WASHINGTON — The political heat on Fannie Mae could be cooling, following comments by Treasury Secretary Paul O’Neill that were supportive of the housing-finance giant.

All kinds of nice quotes in the article:

“I consider Frank Raines to be a close personal friend of mine,” Mr. O’Neill said in the interview, adding the two had served 10 years ago on the board of a nonprofit organization, which Fannie Mae said was Manpower Demonstration Research Corp.

http://online.wsj.com/article/SB981680536590781645.html?mod=googlewsj

In 2000, Rep. Bob Ney introduced a subprime lending bill that would have preempted state law and provided a uniform national standard for subprime lending. He couldn’t get enough cosponsors to even get it heard in the committee. If that bill had been supported by O’Neil it might have made a difference. I’m sure he was asked.

There’s a big assumption on the left and right that Republicans generally didn’t care about lending standards. It’s not true. Democrats blocked two different bills on subprime lending because they did not want to preempt states. The lax regulation by states led directly to the devlopment of the monoline subprime lenders who produced so much of the bad paper we are now getting to buy.

Maybe being white, legal and educated disqualifies us?

Hening on September 25, 2008 at 5:35 PM

That pretty much covers it.

*eats*

Grue in the Attic on September 25, 2008 at 5:38 PM

I am becoming increasingly convinced that the “new affirmative action” Obama refers to is precisely this concept.

Gasbag CYA moment of the day

I guess the source shouldn’t surprise anyone, as former Treasury
Secretary Paul O’Neill has a habit of saying some fairly stupid
things. Today’s criticism of the Bush administration bailout……

They lucked out with us. Still paying on time! But it could have just as easily gone the other way.

I bought my first house and applied for my first mortgage in 2000. No one ever asked for a pay stub. No one ever called my employer. O’Neill is full o’crap.

Last time we moved I was starting to think I was going to have to turn over my bowling scores for the last decade…

Sleepyhead O’Neil isn’t wrong on the cause of the problem,..he’s just Monday morning quarterbacking a bit in an effort to avoid any smelly splash on his own suit lapels. Lack of accountability is very important to him.

a capella on September 25, 2008 at 5:47 PM

Being sure you have a job with no measureable goals is a very important part of standard Harvard MBA teachings… seriously.

CC