Allow me to whine a little. Actually, we shouldn’t be whining. We should be screaming. We should be screaming at these people who are so out of touch with what happened that it’s criminal. Skip a vacation? Manage a budget? Buy a clue! If I didn’t personally see LO’s lie to their clients about the loans they were receiving, if I didn’t personally see EO’s turn a blind eye, if I did not see people signing loan papers that they had no business signing, that would be one thing. But I saw it all first hand. I know how we got here. I was chirping about this in 2005. And I was right. Executives turning a blind eye to the practices in the communities in favor of profits. Or maybe they didn’t. Maybe they didn’t know enough to see where the scams were being run. The bottom line looked great and what else do we care about in this ADD society? It don’t look so great now eh boys?
The riff raff is out of the business now and that’s a good thing. I know LO’s who have had zero loans go bad in all this. ZERO. I know one guy who has had two go bad in a thirty year career. Those are well qualified borrowers who have been placed in appropriate financial vehicles, by professionals. Unfortunately, there was a lot of a different sort of business going on out there over the last five years. I personally walked away from my notary commission. In California, the notary’s job is to essentially verify that the person is the person they say they are and that they signed the document in the notary’s presence. They are not allowed to interpret the documents for the signer. Unfortunately if you’re smart enough to know what the documents are saying, and can see the numbers on the app., it doesn’t take a rocket scientist to figure out they can’t afford the loan. As a notary, there’s nothing you can do. Three years ago, no one wanted to hear that the borrowers shouldn’t be signing the loan, that they didn’t understand what they were signing. The mortgage broker wanted his commission, the bank wanted their interest, the title company didn’t want to lose the business and no one, NO ONE was looking out for the client.
The guy who bought my house and subsequently lost it in foreclosure had no business buying that house. I was ready to pull it off the market when some huckster in San Jose finally put the loan together. This jackass bought a $555k house with $500 down. And we wonder why there’s a mortgage problem? I promise you, he did not understand what he was getting into. He barely spoke English. His real estate agent and his LO took their commissions and screwed him. I don’t know how that bank could have known what the guys on the ground here did to them.
Still, borrowing money on a house is a business decision. Make a bad business decision and the shit will hit the fan. Well, the shit has hit the fan. Banks made bad business decisions and they’re feeling the pain and borrowers made bad business decisions and they’re feeling the pain. The way that the GFE’s are set up, ARMS look squirrelly on them and really reflect Fiction in Lending, not Truth in Lending.
There’s plenty of blame to go around on this one. I’m just appalled at the lack of understanding of the issue by our politicos. It’s not a matter of skipping a vacation. Personally I haven’t been on vacation in over a year. I know a lot of people who aren’t taking vacation because they want the pay out when they’re laid off. That’s why I didn’t take mine. I knew the Amateur Manager had me on his To-Do list from day one. I didn’t take a single vacation on his watch. People who were at Financial have written me and told me they had four/five weeks worth of vacation that they were saving in case they got laid off. So sorry Mr. McSame, cancelling a vacation ain’t going to cut it buddy.