Part of Bush's call for an "ownership" society of course was for rich people and bankers to own poor people. Call it the New Serfdom. Or financial slavery. And of course, those at the bottom of the socio-economic status ladder were easy targets for the subprime lenders empowered by Bush and Greenspan's call to ARMs.
I don't think the subprime lenders were verifiably racist. They were simply going after the easy targets (suckers) - the group of financially unsophisticated, underemployed, renting suckers who were made to believe that home ownership at any cost was a smart move.
Unethical mortgage brokers make more commission the more they screw someone, so they went all out and screwed people as hard as they could.
Payback is a bitch, and even though millions will go bankrupt and lose their homes, at least they took down the lenders, bankers and world financial system with them this time.
BOSTON (Reuters) - Barbara Anderson and her husband know racism. Among the first blacks to move into an Ohio neighborhood 25 years ago, she watched in horror as white neighbors burned her garage nearly to the ground.
Fast-forward to 2007 and Anderson talks of a different sort of discrimination: brokers of subprime mortgages who prey on borrowers with weak credit histories like the Andersons, who raised eight children in Cleveland's Slavic Village district.
"These subprime lenders target you to take you through disaster," said Anderson, 59, who filed for bankruptcy after a legal tussle with a subprime lender, a "nightmare" that she said ended four years ago when her home was nearly foreclosed.
"I was fortunate. I went to another bank that decided to give me a chance with a new loan. The day that happened my headache stopped, my blood pressure lowered, my sick stomach went away, and it was because now I could see some daylight."
Across the United States, blacks and Hispanics are more likely to get a high-cost, subprime mortgage when buying a home than whites, a major factor in a wave of foreclosures in poor, often black neighborhoods nationwide as a housing slowdown puts millions of "subprime" borrowers at risk of default.
Even more troubling, real-estate industry analysts say, is an alarming proportion of blacks and Hispanics who received subprime loans by predatory lenders even when their credit picture was good enough to deserve a cheaper loan.
97 comments:
damned if you do.
damned if you don't.
After a little more research i found this....
http://www.billcara.com/CS%20Mar...d% 20Housing.pdf
And if the banks didn't lend them the money - they would cry racism becuase they would not make loans to minorities.
It is the excuse of the new age - Nothing is my fault...
Everyone is a victim. This country is so doomed.
n greater Boston, 71 percent of blacks earning above $153,000 in 2005 took out mortgages with high interest rates, compared to just 9.4 percent of whites, while about 70 percent of black and Hispanic borrowers with incomes between $92,000 and $152,000 received high-interest rate home loans, compared to 17 percent for whites, according to his research.
Hmmmm. Making good money and still cant make ends meet. Something is wrong here.
They forced me to buy a house, I need to be bailed out now. It's not my fault.
A Demographic less likely to read the fine print. I can see the law suits now! "Fine print was in English only"
Chicago has numerious "Black" banks. I wonder if they screw blacks too.........
Anonymous said...
And if the banks didn't lend them the money - they would cry racism becuase they would not make loans to minorities.
It is the excuse of the new age - Nothing is my fault...
March 20, 2007 5:38 PM
---
Interest? Interest?? Black people shoudln't have to pay interest!
Anonymous said...
And if the banks didn't lend them the money - they would cry racism becuase they would not make loans to minorities.
It is the excuse of the new age - Nothing is my fault...
March 20, 2007 5:38 PM
---
Interest? Interest?? Black people shouldn't have to pay interest!
Hey Keith,
Picked this up on another blog:
"Houses Cheaper than Cars in Detroit." The bubble flattened out there.
http://blog.foreclosure.com/
Wait for the probable recession Warren Buffet spoke about.
I wonder what the average "urban african"'s credit scores are? Ofcourse I'm sure it's racist to consider credit scores when loaning money to urban africans...
They raised eight kids! - No wonder they can't afford their mortgage payments!!
WOW!!! This is huge..and no mention of it at all in the MSM
Anyone watchng the dollar tank today
http://www.reuters.com/article/ b...035119120070320
Wow, did some of you overlook this little statement (and I added bold text to point out the important part)?
Even more troubling, real-estate industry analysts say, is an alarming proportion of blacks and Hispanics who received subprime loans by predatory lenders even when their credit picture was good enough to deserve a cheaper loan.
And how is a mortgage broker putting a white person with an identical financial profile in a prime (cheaper, less risky) loan, while putting a minority into a sub-prime loan (even though they qualify for a prime) NOT strongly suggestive of racism?
When Greenspan gave his public blessing to the use of sub-prime loans in 2004, he basically declared open hunting season on buyers who came late to the bubble party. Many predatory agents and brokers actively searched for minority buyers (even operating at swap meets, where in San Jose they were eventually kicked out for harrassing swap meet participants!), letting them know they could get a house with a "you don't want to get priced out of the market forever, do you?" sales pitch.
Greenspan's blessing in essence absolved sub-prime lenders for letting minority buyers into the party, but ONLY after home prices had already peaked and needed more fodder for the bubble.
(and Greenspan says he's not able to spot a bubble when he's in one, my ass....)
A few 'lair' loans, a bit of mortgage fraud later, and the temptation was apparently too much for the REIC to pass up, one last chance to inflate the bubble (where everyone's commission is based on percentages of an already-inflated price).
BTW, lately, I've been watching a lot of new commercials from real estate and mortgage companies, in which actors are African-Americans.
They forced me to buy a house, I need to be bailed out now. It's not my fault.
Yeah, well those of us waiting on the sidelines with our great FICOs and down-payments got screwed, too, as every unqualified buyer put into a home they couldn't afford pulled one more house off the market (if only temporarily), thus reducing existing inventory for those of us who COULD afford to buy (but were not stupid enough to buy a clearly over-priced property during the largest asset bubble in history).
So realize the market-tampering scam hurt not just the person who signed a contract they couldn't afford, but in fact every qualified buyer who actually paid too much in 2004-2006 (AKA FB). Those of us who didn't buy will need to wait longer for things to normalize, but the only silver lining is we're not trapped in an expensive mortgage paying for a depreciating house (that we cannot refinance)....
Make no mistake: this was MASSIVE consumer fraud on a mind-blowing scale, fueled by the REIC (agents, mortgage brokers, etc) and their love of commissions. Remember, they earned the same (no, healthier) commission on a foolish buyer who couldn't afford the home, than a prudent buyer who knows better....
A Demographic less likely to read the fine print. I can see the law suits now! "Fine print was in English only"
Dunno where you are, but we've had such restrictions on the books in California since the 1980s, with consumer protection legislation enacted after the last time this same exact scenario played out at the end of THAT boom/bust cycle....
The problem is not one of needing more laws, but enforcing laws ALREADY on the books. When times were good, all the State and Federal regulators were looking the other way; now that the bubble has burst, suddenly everyone wants to know what happened....
Subprime lenders should be held accountable for their fraud. Not only that, all this talk about bailing folks out of their own mess is not answer. What if we enact legislation that forces subprime lenders and those sponsoring them to foot the bill, helping out these buyers?
Why should the American public help either the lenders or the buyers in these cases? If you look at inner cities in Southern California many places cost $400,000 to $500,000. Do you think people making $35,000 to $40,000 can afford this?
Major rip off and all this talk about bailing either side out is ridiculous.
Broader Investigation of Lenders by SEC
Monday March 19, 8:35 pm ET
By Marcy Gordon, AP Business Writer
SEC Investigating Subprime Mortgage Companies, Enforcement Chief Says
WASHINGTON (AP) -- The Securities and Exchange Commission is investigating a number of companies that operate in the troubled market for subprime mortgage loans, the agency's top enforcement official said Monday.
ADVERTISEMENT
It has been known that the SEC was examining accounting practices at New Century Financial Corp., the nation's second-largest maker of subprime mortgages -- higher-priced home loans for people with tarnished credit or low incomes.
But comments by SEC Enforcement Director Linda Thomsen on Monday were the first public acknowledgment that the agency was involved in a broad examination of the subprime sector within the mortgage industry.
"We're looking at subprime," Thomsen told reporters following an address to an investment conference. "As with anything, we're going to look at all the actors and their roles."
She declined to provide further details. The SEC as a rule does not comment publicly on current investigations.
Lenders are among a web of players that take part in the subprime mortgage market, including mortgage brokers, property appraisers and financial institutions that buy loans in bulk and bundle them into securities for sale to investors.
The role of major Wall Street investment firms in the subprime market debacle is under scrutiny. In Massachusetts, the state's top securities regulator said last week that he had issued subpoenas to two major firms -- UBS Securities LLC and Bear Stearns & Co. Inc. -- as part of an investigation into whether their analysts' research ignored subprime lenders' mounting financial problems.
The Bush administration's housing secretary, Alphonso Jackson, disclosed last week that the government was preparing to punish some subprime mortgage lenders that have been under investigation for discriminatory practices. He did not name the companies. HUD's Office of Fair Housing has brought several cases against mortgage lenders and insurers for predatory practices, and those enforcement efforts are continuing, the department said.
There has been an alarming spike in foreclosures, especially among homeowners who took out subprime loans. In recent weeks, lawmakers and regulators have been voicing concern that many people could lose their homes as mortgage delinquencies mount and distress grows in the market for subprime mortgages.
Also, lawmakers have denounced what they say are abusive practices by some mortgage lenders that target the poor, minorities and the elderly. Senior Democrats are drafting legislation intended to curb predatory lending -- which occurs, for example, when lenders pressure home borrowers into high-interest loans that they may not be able to repay.
Sen. Christopher Dodd, D-Conn., chairman of the Senate Banking Committee, announced Monday that he had asked the chief executives of five of the biggest players in the subprime mortgage market to testify at a hearing on Thursday. In addition to New Century, they are: HSBC Holdings Corp.; Countrywide Financial Corp.; WMC Mortgage, which is owned by General Electric Co.; and First Franklin Financial Corp., part of Merrill Lynch & Co.
"At the very least, homeowners facing foreclosure deserve to know what factors contributed to their dire financial straits, and what steps are needed to fix this pressing problem," Dodd said in a statement.
Anxiety that a blowup of subprime mortgage lenders could spill over into the broader economy has roiled the financial markets in recent weeks and played a major role in the swoon on Wall Street that pushed the Dow Jones average to its lowest levels in more than four years.
New Century has scrambled to stay afloat as banks cut off funding because of a failure to make payments. Irvine, Calif.-based New Century, which already has stopped accepting all new loan applications, said recently there is no guarantee it will receive any additional financing.
Like other subprime lenders, New Century uses short-term borrowings -- often from major Wall Street investment houses -- to finance the mortgage loans it makes. Like other subprime lenders, it has become increasingly difficult for New Century to obtain the short-term lending needed to finance its mortgages.
The subprime sector has seen a sharp decline in banks' demand for potentially troublesome loans as the housing market has slowed since late 2005, grounding the high-flying real estate boom. As long as home prices rose, borrowers who got into trouble could just refinance or sell their homes, which spared banks from getting stuck with sour loans.
The fallout from the housing downturn has spurred several subprime lenders, including ResMae Mortgage Corp., Ownit Mortgage Solutions and Mortgage Lenders Network Inc., to file bankruptcy in recent months.
Don't Blame the Market for Housing Bubble
March 19, 2007
The U.S. housing market, long considered vulnerable by many economists, is now on the verge of suffering a serious collapse in many regions. Commodities guru and hedge fund manager Jim Rogers warns that real estate in expensive bubble areas will drop 40 or 50%. Mainstream media outlets like the New York Times are reporting breathlessly about the possibility of widespread defaults on subprime mortgages.
When the bubble finally bursts completely, millions of Americans will be looking for someone to blame. Look for Congress to hold hearings into subprime lending practices and “predatory” mortgages. We’ll hear a lot of grandstanding about how unscrupulous lenders took advantage of poor people, and how rampant speculation caused real estate markets around the country to overheat. It will be reminiscent of the Enron hearings, and the message will be explicitly or implicitly the same: free-market capitalism, left unchecked, leads to greed, fraud, and unethical if not illegal business practices.
But capitalism is not to blame for the housing bubble, the Federal Reserve is. Specifically, Fed intervention in the economy-- through the manipulation of interest rates and the creation of money-- caused the artificial boom in mortgage lending.
The Fed has roughly tripled the amount of dollars and credit in circulation just since 1990. Housing prices have risen dramatically not because of simple supply and demand, but because the Fed literally created demand by making the cost of borrowing money artificially cheap. When credit is cheap, individuals tend to borrow too much and spend recklessly.
This is not to say that all banks, lenders, and Wall Street firms are blameless. Many of them are politically connected, and benefited directly from the Fed’s easy money policies. And some lenders did make fraudulent or unethical loans. But every cent they loaned was first created by the Fed.
The actions of lenders are directly attributable to the policies of the Fed: when credit is cheap, why not loan money more recklessly to individuals who normally would not qualify? Even with higher default rates, lenders could make huge profits simply through volume. Subprime lending is a symptom of the housing bubble, not the cause of it.
Fed credit also distorts mortgage lending through Fannie Mae and Freddie Mac, two government schemes created by Congress supposedly to help poor people. Fannie and Freddie enjoy an implicit guarantee of a bailout by the federal government if their loans default, and thus are insulated from market forces. This insulation spurred investors to make funds available to Fannie and Freddie that otherwise would have been invested in other securities or more productive endeavors, thereby fueling the housing boom.
The Federal Reserve provides the mother’s milk for the booms and busts wrongly associated with a mythical “business cycle.” Imagine a Brinks truck driving down a busy street with the doors wide open, and money flying out everywhere, and you’ll have a pretty good analogy for Fed policies over the last two decades. Unless and until we get the Federal Reserve out of the business of creating money at will and setting interest rates, we will remain vulnerable to market bubbles and painful corrections. If housing prices plummet and millions of Americans find themselves owing more than their homes are worth, the blame lies squarely with Alan Greenspan and Ben Bernanke.
There are times when i consider that maybe society is not really that racist anymore, perhaps there's less of a need for policies like affirmative action.... than i come and read comments that people write on the internet, particularly the "Anonymous" comments, be it on HP or other websites, and i realize that in fact we're still a very racist society, people are just more hidden about their racism.
we still have alot of work to do, and i present some of the comments here as exhibit A
Some people are born to be slaves; if not to debt, then to welfare, or to drugs, or to religion. Maybe it's genetic.
I think they will bring down the country more than the illegal aliens will. Don't forget how well they conducted themselves after Katrina. How will they conduct themselves after the bubble bust?
I believe that the pandering Mercedes Benz commercials done with a rap version of the theme song from "The Jeffersons" is just as craven as anything advertised by alternative mortgage products salespeople.
Smug Bastard
This is unbelievable! If the ratings agencies (Moody's, S&P, Fitch) properly rated (marked to market) all the mortgage-backed debt (which is their job I might add), our entire economy would fall apart at once. Behold, this is the wall of water. Un-effin-real.
From Fortune/CNN: http://tinyurl.com/2zlfue
"There are times when i consider that maybe society is not really that racist anymore, perhaps there's less of a need for policies like affirmative action.... than i come and read comments that people write on the internet, particularly the "Anonymous" comments, be it on HP or other websites, and i realize that in fact we're still a very racist society, people are just more hidden about their racism."
Is it racist to say that blacks on average have lower credit scores than whites?
People's Choice Home Loan Files for Bankruptcy (Update2)
By Tiffany Kary
March 20 (Bloomberg) -- People's Choice Home Loan Inc., a mortgage lender for people with credit problems, filed for bankruptcy protection.
The Chapter 11 filing today in U.S. Bankruptcy Court in Santa Ana, California, comes as delinquency rates on so-called subprime home mortgages hit a four-year high. Subprime lenders specialize in loans to customers with bad credit or heavy debt.
People's Choice, based in Irvine, California, is the fourth subprime lender to file for bankruptcy since December, joining Ownit Mortgage Solutions LLC, Mortgage Lenders Network USA Inc. and ResMae Mortgage Corp.
In the past year, shares of three other subprime lenders -- Fremont General Corp., New Century Financial Corp. and NovaStar Financial Inc. -- have lost at least half their market value.
Filing the same day as People's Choice Home Loan was People's Choice Funding Inc. The companies are subsidiaries of People's Choice Financial Corp., a real estate investment trust.
Both subsidiaries estimated that they have more than $100 million each in both assets and liabilities, according to court documents. Information about overlapping assets or creditors wasn't immediately available.
John Salvador, director of investor relations for People's Choice Financial, and Jeremy Richards, a lawyer for the debtors, didn't immediately return calls or e-mails seeking comment.
Creditors
Among the 20 largest unsecured creditors listed in People's Choice Home Loan's court papers are Wachovia Bank NA, Bear Stearns Mortgage Capital Corp. and Merrill Lynch Mortgage Lending Inc.
Last week, People's Choice Financial withdrew a registration statement with the U.S. Securities and Exchange Commission that it had filed to sell around 64.3 million shares valued at $192.9 million. The company cited ``various business and market reasons'' for the withdrawal.
According to the registration statement, filed in June 2006, People's Choice Financial had about $3.9 billion in mortgage loans for investment on its balance sheet in March 2006. It issued $4.5 billion in mortgage-backed securities in 2005.
The registration statement said People's Choice Home Loan was formed in 1999 and People's Choice Funding in 2004.
The cases are In re People's Choice Funding Inc., 07-10767; and In re People's Choice Home Loan Inc. 07-10765, U.S. Bankruptcy Court, Central District of California (Santa Ana).
To contact the reporter on this story: Tiffany Kary in New York at tkary@bloomberg.net .
Kieth -
Check it:
http://tinyurl.com/39hh6g
I'm shocked, SHOCKED!
And how long before our duplicitous Fed admits the same?
It's an individuals' job to shop for the best loan.
Banks don't have software that screens for black people and gives them higher rates.
They DO look at credit scores though...NOT JUST INCOME. Frequently the MSM will quote something about how blacks and whites at similar income levels...blah blah blah and the blacks get rejected more, pay more interest. The implication is 'racism'.
However, how is this done? The lending is done by software. Ratios, etc. Income is one parameter but not the only one. Debt levels, asset levels, credit score, time in job. However NO PARAMETER is RACE. Get it? So how do the computers know the guy is black?
Hmmmm....Seems like some bank could make a fortune by advertising that they loan to creditworty blacks at market rates....a niche business if you will. Why don't they? Is it a conspiracy?
Angelo Mozilo sez
The Fed needs to cut rates to soften the blow.
A negative impact on the economy is expected. Regulators need to mitigate economy impact of this, as it is too important to the wealth building American people and the people that have re setting loans.
Values are going down and people are exposed and people get angry.
Great for Country Wide
bad for
new home buyers
and
minorities.
Screw the little guy as usual.How do you think thse college punks were makeing over 100k a year?Easy targets are uneducated minorities, right?"Think education is expensive , try ignorance". Being a nice guy isn't part of the game.They all wanted new cars so they could get laid.Isn't that out system works.Makes lots of money and the p@ssy will show up at your door.These worthless pieces of sh@t, in suits of course, would sell their mother a bogus loan.It's all about the money right? Because if you don't have any no one give a rats @ss about you here in the great USA.
The real estate market has always had it's period of dips, but in the long run it is always going up! Check out www.incomecows.com for free Real Estate contracts, software, and good information. Now's the time to invest, invest, invest! In 5 years you will wish you did!
I agree its a bit sad to see the explicit racist remarks - I thought people who read these blogs would be more fairminded.
Anyway, as I've been reading the moral panic about subprime loans & lenders in the mainstream media, I'm struck at how folks with subprime credit are being used as the scapegoats for an entire corrupt system.
Almost no one I know who bought a house since 2004 could actually afford it - regardless of their credit score. The entire system was dysfunctional
Minorities apparently dont SHOP AROUND, its cultural. Im jewish you bet we get 15 quotes for a loan before signing.
For that matter how come i never see any minorities online on these blogs?
SPEAK UP amigos/brothers! wth is REALLY happening please tell us.
Trust me, no one qualified for a 30 year fixed for years now. Even if they had good credit. With houses prices x4-x9 times incomes, how could someone with a good credit score and excellent job history buy a home with a conventional loan? Thats the problem.
It's going to be very, very ugly this year when loans reset.
No one forced poor minority idiots to take out mortgages they couldn't afford..or poor white trash either, people are stupid
Fortunately, the National Association of Realtor's own economist David Lereah is all over it, and even breaks out of cheerleading mode to acknowledge the foreclosure problem will probably effect Alt-A:
http://tinyurl.com/2q3umh
In case anyone DOESN'T know, this problem is NOT limited to those with low FICO: the problem is 'liar' (stated income) loans have been used almost exclusively for the past few years, even for prime loans, just to keep puffing more hot air into the bubble.
Towards the end, customers didn't go shopping for loans, the lenders went shopping for them:
http://tinyurl.com/2odzoj
I love the part where the mortgage brokers and real estate agents rent booths to operate at swap meets to find fresh meat/victims, but the operator of San Jose Flea Market wouldn't let them:
Meanwhile, the Flea Market in spring of last year stopped renting space to real estate and mortgage companies. "They were very annoying to our customers," said Patrick J. DeTar, reservations manager for the flea market.
So just how annoying do you have to be to be refused rental space at a swap meet? Even the reservation manager of the flea market shows better business sense and respect for his customers than these self-labelled REIC "professionals" do.
WHAT?
Whitey keepin the brothers down..
say it ain't so!
Anon said:"Even more troubling, real-estate industry analysts say, is an alarming proportion of blacks and Hispanics who received subprime loans by predatory lenders even when their credit picture was good enough to deserve a cheaper loan".
As much as we like to think minorities were "targeted", it really boils downs to "anyone breathing" is targeted. Even with a downpayment, buyers of any race had to use sub-prime loans because the properties were so much more than their incomes. Its not about just "they had a down payment" or "they have good credit" and were put in these "bad loans".
Lots of white families too used these loans as well because of their "income to loan" ratio was not high enough to buy using a conventional loan products.
If I wanted to buy a house today, at today's prices I could - even with a 20% downpayment, I would only be able to qualify for a I/O or another toxic loan product. It's all about the PRICE.
Black, white, yellow, orange and blue - it doesnt matter - EVERYONE is going down!
Hypothetical Question for the white people:
There is a new compound invented that will turn a white person into a black person FOREVER; it doesn't "wear off".
Now,
How much money would you need to be paid in order for you to take compound and be turned into a black person forever?
All it does is change your appearance, nothing else; if you have an IQ of 160, you keep that.
Pick your amount and it will be deposited into your account.
Gawd, I wish the people knew how to borrow the yen at .5% and take that money and draw 4.5% US in interest from US treasuries invested. Then everybody could afford these houses today, because it would be money for nothing and your chix for free!!!! But no; the bush and his gang want you to eat his scheitt sandwich instead of sharing in the glory.
Dr housing bubble said:"Why should the American public help either the lenders or the buyers in these cases? If you look at inner cities in Southern California many places cost $400,000 to $500,000. Do you think people making $35,000 to $40,000 can afford this"?
------
Well said DHB.
My guess is it's not only about the subprime borrowers. It's about all borrowers having difficult time with these outrageous loans. I find it difficult to believe that a lender would only make loans to borrowers with low credit scores.
The entire industry is in meltdown. This blame the subprime is just the latest tactic to spin the real problem.
FWIW, these 'liar' loan (or unstated income) buyers have no idea how lucky they are, being blocked from certain foreclosure by buying a house AFTER the bubble has already burst! This is NOT the time to buy!
For example, here's a Spanish-speaking women (who works for a janitorial service) who wants to buy a $500,000 crap-house in San Pablo, with no down and no proof of income. She was all set to go, when the rules changed last week.
http://origin.mercurynews.com/news/ci_5459859
But wait, read on and you'll see she WASN'T turned down for a loan after all! She still got a loan from another lender, only NOW she'll be paying higher interest rates!
Smith and loan officer Sandra Sherry found a loan to replace the one that fell through, but Peña is paying 1.25 points to get the same rate and terms she was supposed to get earlier this month from a different lender without paying points (One point is equal to 1 percent of the loan amount; paying points upfront helps "buy down" the loan's interest rate.)
As you can clearly see, we have a LONG way to go in cleaning up this whole "let's sell homes to people who clearly can't afford them, just so we still make our fat broker and agent commissions" scam, since even in spite of ALL the publicity, they're STILL originating loans that are 100% destined to FAIL.
Good lord, when will it end?
"But capitalism is not to blame for the housing bubble, the Federal Reserve is. Specifically, Fed intervention in the economy-- through the manipulation of interest rates and the creation of money-- caused the artificial boom in mortgage lending".
Exactly. 911 was the excuse to drop interest rates to basically ZERO. What did the Feds think would happen?
Laura, read the article again and you'll see that the study found an "alarming disproportionate" rate of mortgage brokers putting minorities into sub-primes vs. whites. So it's not just a "let's screw everyone" thing...
Ah yes, the OJ Simpson defence, Iz it cos I iz black?
The 1000s of whites that took out identical mortgages was due to there own stupid greed, however if you happen to be black, it's because the banks are racist, Right...
you mean the banks discriminate among peasants?
Shame on those despicable mortgage brokers, loan officers, real estate brokers and appraisers who prey on the low income uneducated segment of society. The network news tonight reported that 40 million Americans are functionally illiterate and are unable to perform basic functions such as writing a check or reading a legal document. If they can't read the friggin mortgage, they do not know what they have agreed to pay and they listen to the crooks. Where are Jesse Jackson and the other liberal do gooders who could be helping these people avoid financial disaster? These people are so incompetent in financial affairs that they trust the people who are screwing them. One solution that may help would be a requirement that these people discuss the proposed loan with an unbiased adviser who could point out that the intest rate and monthly payment will adjust in 3 years with a high probablity that the payment will then increase by an additional $400-800 per month and that if the buyer will not get that additional income, the home should not be purchased as they will lose it by foreclosure or bankruptcy in 3 years. These buyers are too proud and happy to get a house to be willing to admit that they do not understand what they are signing.
Raines at fannie, screw everybody, big, big time, one of the best, aint got no handcuffs yet!
I would like to see an analysis of how the mortgage crisis will play out. The buyer does not make the payment, the lender who sold the loan to a loan consolidator reports that the payment was not made, the pension fund, hedge fund or overseas investors is advised that the loan is in default or that the loan balance far exceeds the market value of the house and the quarterly reports to the ultimate investors eventually advise that there are big problems with the CDS (colateralized debt security) and these investors sell these securities and take a big loss.
How long will it take for the persons depending on this pension fund to realize that substantial losses on the value of the fund have been incurred? When this starts happening to hundreds of thousands of CDSs will this crash the economy and the stock market?
This might be a good topic for a separate thread.
"There is a new compound invented that will turn a white person into a black person FOREVER; it doesn't "wear off".
Not a problem, so when I apply for the job of Director general of the BBC, ICI, etc it wont be because I'm unqualified, inexperienced or whatever for the job, it will be because of ole whitey keeping us down once again.
Tell that to the numerous doctors, lawyers, judges, police chiefs, mayors, politicians like Condie Rice, Colin Powell etc where the ole white ceiling hasn't impaired them too much.
Tell me all about how they're sell outs, tokens, or uncle Toms.
Off topic but on target as far as banks/businesses taking advantage of the uneducated. In this case the native americans.
http://indianz.com/News/2007/001860.asp
BTW, for those of you who view our posts as racist, WE posters were NOT the ones making these sleazy deals to anyone, taking advantage of anyone, nor setting up anyone for the fall when the buyers get stuck with a house that loses value and whose monthly mortgage payment skyrockets after 2-5 years.
Sub-prime lenders (or sub-human predator lenders) took advantage of any and everyone that walked through the door.
What ever happened to
"save up,
buy what you can afford,
read the fine print,
hire a lawyer to look over the paperwork if you can't understand it"
mentality?
Oh yes, I forgot, common sense fled the country when the Keynseians "deficits don't matter" mentality took root.
also in california the % of whites is below 50%, hispanic 30% and blacks 17%. So how much of this mess in California is caused by Blacks. I don't see alot of them moving into brand new subdivisions with 750,000 price tag on a oversized apartment. I see blacks trying to stay reasonable and buy just a basic house in a neighborhood where they are welcome and obviously it's not in a lot of neighborhoods lived in by the people who are on this blog.
SENT TONIGHT BY SUNTRUST AFTER 5pm.
Really need to get a hold of your email adress so I can send you the attahcment.
_______________________
Suntrust has the biggest pull out so far!!!!! Read the first page of the attachment, it explains why and what investors have done in recent days.
" No more reduced doc for salaried borrowers, or for first time home buyers"
No longer doing 100% financing over 400K for any document type!!!!!!!
When the garage was burned to the ground, they should have taken the hint. They belong in Africa, it is their continent.
Jessee Jackon and the rest will be all over that racial angle
Anonymous said...
"There are times when i consider that maybe society is not really that racist anymore, perhaps there's less of a need for policies like affirmative action.... than i come and read comments that people write on the internet, particularly the "Anonymous" comments, be it on HP or other websites, and i realize that in fact we're still a very racist society, people are just more hidden about their racism."
Is it racist to say that blacks on average have lower credit scores than whites?
March 20, 2007 9:09 PM
NO, ACTUALLY, IT'S QUASI-FACTUAL.
.0000000001% of people are racist. get over yourself.
affirmative action is AFFIRMATIVE RACISM... that's all.
I want all race based 'ANYTHING' eliminated.
No more racist based congressional caucuassess. no more check boxes on applications and quizes.
it is irrelevant.
Anon, I understand what you are saying. However, many chinese bought into these types of mortgages too, not just blacks and hispanics. IMO, it still boils down to a willing buyer and a broker that will accomodate a buyer with an appropriate loan product for their downpayment size. Has nothing to do with discrimination, its a numbers game.
I know many people (all white) that have these kinds of loans, they got into loans they couldnt afford because they wanted a particular house so bad. When people get obsessed with buying, they don't care about loan details - they just want to sign on the bottom line. I dont know the percentage, but in this market, there are plenty of loan officers and brokers that are the same nationality of buyers to help them understand the various loan products, good and bad.
I'm sorry. It doesnt sound like I have much sympathy...and I dont because all buyers can't make an excuse "they didnt know" or "didnt understand what they were getting into" when that market turns on them.
It really botheres that TPTB have been trying for weeks now to frame this as a "minorities problem", as if the only people dumb enough to jump onto these bad loan products were blacks or latinos.
News Flash: I'm sure there were plenty of white dumbasses out there who did the exact same thing.
Let's get serious here, does anybody really believe there aren't/weren't any stupid white people with low FICO's out there trying (and succeeding!) in buying homes they could not possibly afford?
The question is, why is the media insisting on framing things this way?
Read Marinites link.
The Bank of England chiefs admit their plan was to push people into indebtedness "to avoid economy going into a recession".
Exactly what our Fed did.
Bright leaders one and all: avoid a recession to get....a DEPRESSION! Brilliant! And it's working!
Take it away China- your turn. The west has played all it's cards and blown every gasket.
You guys are soooo hypocrites. When the African-Americans are winning for your team, like in football, baseball, basketball, etc, you get cheer like a whore. The same thing when you listen to Soul, R&B, Jazz, Blues, and Hip-Hop, or when you get your asses saved by a black fireman or cop. But for everything else you are racists, refuting that blacks are targeted and taken advantage of. Bunch of a**holes. No wonder Michael Jordan said that if you're born black in America, you have to work in double to succeed. BTW, I'm Caucasian.
Budvar said...
"There is a new compound invented that will turn a white person into a black person FOREVER; it doesn't "wear off".
Not a problem, so when I apply for the job of Director general of the BBC, ICI, etc it wont be because I'm unqualified, inexperienced or whatever for the job, it will be because of ole whitey keeping us down once again.
Tell that to the numerous doctors, lawyers, judges, police chiefs, mayors, politicians like Condie Rice, Colin Powell etc where the ole white ceiling hasn't impaired them too much.
Tell me all about how they're sell outs, tokens, or uncle Toms.
Budvar, You didn't answer the question.
You say its, "not a problem", but you still did not answer the question.
Please answer the question Budvar.
Hypothetical Question for the white people:
There is a new compound invented that will turn a white person into a black person FOREVER; it doesn't "wear off".
Now,
How much money would you need to be paid in order for you to take compound and be turned into a black person forever?
All it does is change your appearance, nothing else; if you have an IQ of 160, you keep that.
Pick your amount and it will be deposited into your account.
How much money would you need to be paid in order for you to take compound and be turned into a black person forever?
All it does is change your appearance, nothing else; if you have an IQ of 160, you keep that.
Pick your amount and it will be deposited into your account.
**************
IS that from THE SECRET?
hehehehehe
Go on then, is the money amount dependent on how black I become?
Can I choose to be Halle Berry or Mariah Carey black or does it have to be bush afro bone through the nose black? What about Hispanic?
Can I be Hispanic? If so, would this be Christina Aguillera or Shakira hispanic or do I have to have gang tats or clean toilets or pick lettuce for a living?
Also if I became black or hispanic would I have a sense of rhythm and be able to dance without looking like an idiot?
So someone who says blacks weren't "targeted" is racist? FU. That's an opinion.
They didn't say they LIKED that blacks are foreclosed just disputed the assertion in the first place.
Sub-primes will take advantage of anyone. Buyer Beware. That's the society we live in.
If you go to a reputable bank and you qualify for a loan, they don't stick it to you cause you're black. They just don't. Show me evidence that they do. And evidence isn't "these blacks make as much as these whites" and pay 1/4% more. Income is only ONE PARMETER that loans are based on.
Loan to value? Credit score? Time in job? Other debts? Other assets? Stability of job?
The credit scoring programs at major banks are not programmed to account for race at all. So of course you want to scold whites for being 'racist'...that's what people like you do. Claim moral superiority by denouncing people who dont' agree with you. IN a situation you don't even understand.
The people shuffled into houses and subprimes are first time home buyers. They go after the poor apartment dwellers with minimal assets. Those people are disproportionately minority. Is that a conspiracy? They'd do the same with poor whites if they could get their hands on them.
And the poor minorities who bought 3 years ago probably made a lot of money doing it.
And if they DIDN'T lend money to them, you'd claim that was racist as well. Disparity in home ownership between black and white is prima facie evidence of racism according to people like you. So along comes a program to help that situation and guess what...it's racist!
IF you asked most blacks to become white they probably wouldn't go for it either.
So what?
It's because people don't want to change who they are, not because they are 'racist'.
How much would you have to pay the average man to become a woman? And how much would you have to pay a woman to become a man?
See!! Everyone is SEXIST too!!!
Clown.
And another thing...
What do you think subprimes are going to do when a black or anyone else qualifies for good credit....refer them to the bank down the street? No, of course not. They put them into the subprime loan. That's how they make money.
If you go to a Toyota dealership they'll tell you to buy a toyota not "go to the GM place, they'll be better for you".
That's the way capitalism is. Cruel, but it doesn't have anything to do with race or people being 'targeted'. The people who end up with the loans are suckers, it's a shame.
How about the 'payday loan companies' or the 'title loan companies'? A complete rip-off. I bet if you checked that most of their customers are poorer than average. How dare they 'target' the lower socio-economic groups.
What did you expect? Doctors and lawyers (of whatever race) are hocking their cars for a few hundred dollars?
"weak credit histories like the Andersons, who raised eight children in Cleveland's Slavic Village district."
Having 8 children when you are already poor.....this is altogether a different value system than mine.
I would not have 8 children if I were poor simply because I know I could not provide for them the way I would want to.
This is ridiculous.
I'm kind of glad that the media is focusing on the racial angle of sub-prime mortgages. As long as the face of the borrowers is a black one, the rest of America will tell them "too bad, you shoulda read the fine print".
We all know that if we start showing poor white borrowers like they did during the S&L crises, the politicians will start using Taxpayer money to bail out the fools.
No bail out for anyone during this housing crises. You should have paid down your home. If you're stuck in it because you can't sell anymore, and your neighborhood starts going down because of job loses... TOO FREAKING BAD!!!!
I saved up my cash and rented during this mania. What kind of message will we send to the children if we bail out homehowners when they should have sold at the top and rented?
brianb,
While I agree with some of what you said, just remember it wasn't BANKS makin these loans.
It was independent Mortgage Brokers, who had multiple loan products to choose from who made these loans.
These Mortgage Brokers, many independently licensed from banks, offered those loans which provided the most commission to themselves when they knew they would get away with it.
So don't talk about a bank's super duper whiz kid software making these decisions... it was made by a guy who passed a 2 hour test and got a license. This guy was no different than a used car dealer. And we know how those guys work.
What a crock...
When I got my 6% Fixed Rate 30 Year Mortgage 18 months ago, it was done over the phone.
The broker at WAMU didn't know if I was black, white, yellow, or whatever.
I got my rate based on my FICO score, work history, the fact that I was putting 15% down and was purchasing a home I can afford.
The last time I looked, the color of my skin was not in my credit report. In fact, I think that is illegal.
Could one factor among others listed is that "minorities" tend to purchase homes in transitional neighborhoods with unstable housing values?
Give the Black Panthers Alan Greenspan's address.
Justice served!
"How much money would you need to be paid in order for you to take compound and be turned into a black person forever?"
Oh wait, I'm getting excited!
"All it does is change your appearance, nothing else;"
Nothing else? Never mind.
"if you have an IQ of 160, you keep that."
yeah, whatever.
Seriously as a scientist it would help a very small amount to be eligible for certain programs as a 'minority'.
Theoretical question: If I were a white African-American (and I know a few), would I be eligible?
BTW I think this is why the census says "Black" and not African-American since they didn't mean Moroccans and white South Africans. What about a dark ethnically Indian South African?
"They forced me to buy a house, I need to be bailed out now. It's not my fault."
I had a relative who worked at a car dealership years ago. There was only one black salesman on the lot, so naturally any black customers went to him, expecting that he'd treat them better than whitey would.
He took them all to the cleaners, of course.
Why? Because he was black? No, because he was human and people are stupid.
The majority of white people are so out of reality on what minorities go through. You look like Kudlow and those bastards in Washington, and fox News, who can't see what's going on in the real world, away from their crony jobs of pushing paper and kissing Republican ass for a buck.
Case in point, if Caucasian American women have a hard time climbing the corporate ladder and make less money than Caucasian men to do the exactly same job, imagine how difficult it's for Hispanics, Blacks, Asians, etc, to succeed. Do you really think that Caucasian Americans don't look down on minorities or try to take advantage of them? Of course, unless you have extraordinary talent that makes you rich and an idol, like Tiger Woods or Denzel Washington. Then the majority of Caucasians kiss their asses. Some of you are what we call, the "casual racist", just like Barbara Bush on her demeaning comments about blacks. Some of you, who are well informed, know what I'm talking about. I'm also a Caucasian, by the way.
"Having 8 children when you are already poor.....this is altogether a different value system than mine."
Funny how you guys require accountability from all the poor minorities, but the crook politicians in the Washington can make you their obedient bitches.
If it's all about having accountability, we wouldn't need schools, right? Everybody should just get their own books and study at home. All doctors should study at home and then go perform an open heart surgery on your kids. What you're missing here, my casual racists, is that if you are born into a history of poverty and illiteracy, while the gov and society (like you) doesn't give a damn, it becomes very difficult to break out of that cycle. Again, unless you are born with extraordinary talent and some luck.
Because most of you are out of touch with the real world, you don't notice that the system is made to keep pushing those minorities down, as society is too racist and busy to care, buying their Chinese crap from China and watching American Idol.
Sure, accountability is very important after you have some support at home, easy access to solid education, and direction when you are a kid. If you are born in the projects and everyone else is doing drugs, gang banging, and having 8 babes, chances are you are going in the same route, especially when gov and society don't give a rat's ass.
I bet a lot of you, casual racists, are obese or overweight right now. Yeah, you know who you are. So what's your accountability on getting fit? I bet your parents are huge too, right? Do you know that if you are overweight, you have less chances of getting promoted or being hired? So keep on munching on that processed junk food, because your turn of prejudice is coming sooner or later. The processed food industry and big pharma are taking advantage of your bad and uninformed eating habits, by the way. These industries love fat white ignorant people like you.
budvar said:
"Tell that to the numerous doctors, lawyers, judges, police chiefs, mayors, politicians like Condie Rice, Colin Powell etc where the ole white ceiling hasn't impaired them too much."
Don't laugh, but black activists like jessie jackson and that banana song guy, don't consider Powell or Rice to be black.
As a mortgage broker in Tucson I routinely come across hispanic potential clients. I can't tell you how often they bring in Good Faith estimates from other loan officers who are hispanics (usually the agent will tell me or I can tell by the surname)...anyhow I can't tell you how often I quote a much better deal but they go with the hispanic guy because he is hispanic. This is racism againts me but I don't complain..it's just a fact of life...what's funny is blacks and hispanics don't trust the big banks which in reality will give them the best deal...instead they go to the local mortgage broker who takes them for a ride....funny country we live in.
"The majority of white people are so out of reality on what minorities go through."
Yep, and I'm not going to think about what minorities go through, or any other special status group. I don't have time for this and I have my work to do and investments to make. So, if this qualifies for being "out of reality" then I'm fine with it. Yes, I select schools for my kids with the lowest minority percentage (asians are OK - they study harder than anyone) and do the same with where I live. It's safer this way.
BTW. I'm white immigrant and I don't watch neither NBA nor NFL.
OK Mr whites are culturally and institutionally racist, let me ask you a question.
Would you employ a white man who turned up for an interview for an executive post, who was an ex-con, tatooed, wore hells angel colours, had drink smelling breath or a few rocks of coke on his tasche, was an illegal immigrant, unqualified, spoke little to no English, or any of the above combination, would you hire him?
I should say no of course not.
Now the same question only the applicant is a blackman, and if you don't hire him is it because deep down you're a racist?
True, that hispanics or blacks tend to trust someone more if they are hispanic or black. Thus making them easy targets by their own people. My cousin, which is hispanic and a loan officer, has made 99% of his money from hispanic customers. He takes them to the cleaners with all these bull#@$# fees. $200 notary fee, $75 copy fee, $100 interest negotiation fee, $30 coffee break fee, $40 pen replacement fee, $35 my kid needs a haircut fee, you get the point. Not to mention the back end rebates he gets from banks which he doesn't disclose to his victims. I am terribly disgusted by his business ethics or mainly lack of. Oh, and he didn't graduate high school either. Go figure.....
But ultimately, the buyer is the sucker who falls for it. Hope they learn a lesson after they lose their home.
This is the part where they eat their own
Black and hispanic mortgage brokers going after black and hispanic families - at church, in the neighborhoods, at flea markets, on their TV stations.
"trust us - we're one of you" they said as they signed them up to interest only teaser rate no down liar loans (and pocketed the big commissions paid by whitey)
It wasn't skin color. It was opportunity combined with ignorance combined with greed.
Don't blame the white man, I myself am half white/Hispanic. Truth is hispanic brokers prey on hispanics and blacks prey on blacks because of the trust thing. I guess you can say, brown on brown and black on black crime. Subprime lenders didn't target them, the people who broker these loans did, mostly independent, here one day, gone the next day brokers.
Ellen Florian Kratz, Fortune Magazine writer sure is printing a lot of articles lately about how great Clayton Holdings is at finding fraud and "bad loans". What she fails to mention (also noticably absent from the Clayton executives she quotes) is the fact that Clayton reviews loans BEFORE Wall Street investors purchase them... and they purchased a TON of them with Clayton's endorsement and approval.
Don't look for the buck to stop at Wall Street - Clayton will soon have a lot of explaining to do regarding how all those defaulted and fraudulent loans got past their "experts" in the first place. The subprime lenders aren't going to be the only ones Wall Street will be looking for refunds from I assure you!
Bravo!!!
If you are fat you have already been subjected to terrible prejudice. And you know it too. It's happened to you every day, every interaction, every new person you meet.
Take that smirk or that look of disgust, that cool greeting and multiply by 1000, and you get an inkling of what it is like to be on the sharp end of religionists, racists, sexists, agists, sexual preferentialists, et al, ad infinitum.
Praise Jesuz you're just fat!!!
"I bet a lot of you, casual racists, are obese or overweight right now. Yeah, you know who you are. So what's your accountability on getting fit? I bet your parents are huge too, right? Do you know that if you are overweight, you have less chances of getting promoted or being hired? So keep on munching on that processed junk food, because your turn of prejudice is coming sooner or later. The processed food industry and big pharma are taking advantage of your bad and uninformed eating habits, by the way. These industries love fat white ignorant people like you."
I think it is pretty racist to claim that some who may be "uninformed" is automatically considered a sucker.
We all did not grow up with the benefit of having parents and grandparents with strong financial roots, the "good old boys" network, or the privilege of information.
Jim Crow and the 1960s were not that long ago ....
guess what, I am african-american. i grew up in queens, new york (same neighborhood as 50 cents, the rapper). i did not grow up with money, my friends sold crack and stole cars in junior high school and high school. all the while mcdonalds, burger king, and white castle jobs were not available because they were too many kids and not enough of these "minimum wage" jobs available.
now i have a masters degree in engineering and have invested in real estate since 2001. I am financially free (only because I only support myself, no wife, children) and my primary residence has a mortgage of 5.5% fixed principal and interest for 30 years.
how did i do it .... it was EXTREMELY difficult. it was more or less inner will power and VERY hard work. the majority of people when thrown in a certain situation, will do the common thing. that is why most people get up in the morning, leave their home, and go to work in some form or fashion. It is because that is the common way to make money.
So in reality, it is very uncommon for someone who grew up in the conditions that i did, to actually walk a straight path, get a masters degree, make money in real estate, and become very financially stable at a relatively young age. it happens, but few and far between.
so, take a moment to think, before making some of the very ignorant posts that i have read so far ...
I loved the first 20 minutes of "Pootie Tang".
"So in reality, it is very uncommon for someone who grew up in the conditions that i did, to actually walk a straight path, get a masters degree, make money in real estate, and become very financially stable at a relatively young age. it happens, but few and far between."
The same can be said about any council estate or ex-mining village (totally white areas btw) here in UK.
You've bucked the trend, and managed to claw your way out through nothing short of hard work. The more people like you who can be held up as an example to show what can be acheived through hard work and a few less liberals saying "It's not that people are feckless or lazy that's keeping them down but oppression from the man" the world will be a much better place.
"So in reality, it is very uncommon for someone who grew up in the conditions that i did, to actually walk a straight path, get a masters degree, make money in real estate, and become very financially stable at a relatively young age. it happens, but few and far between."
..........
Sir, I commend you for your perseverance and success amidst the multitude of adversity there is for minorities
So...tell me the truth. With your success $$$ What's the first thing you did..Did you buy the 50inch plasma, spinners for your Bentley, and the gold grill for your mouth?
"what's funny is blacks and hispanics don't trust the big banks which in reality will give them the best deal...instead they go to the local mortgage broker who takes them for a ride....funny country we live in."
My brother in law is a LOON-Officer her in SoCal. He asked what kinds of loan terms I had, I said 30 year fixed. His reply was 'Hahaha all Mexicans only go with 30 year fixed, that's so unsophisticated...Interest only is the way to go" . He was talking to me, a college graduate IT-exectuve.
Here we are 2 years later..he is shitting his pants as he works for an OC Sub-Prime lender.. NUFF SAID.
Suck it and suck it good 'sophisticated real estate people'. Go back to delivering auto parts.
"Sir, I commend you for your perseverance and success amidst the multitude of adversity there is for minorities
So...tell me the truth. With your success $$$ What's the first thing you did..Did you buy the 50inch plasma, spinners for your Bentley, and the gold grill for your mouth?"
actually .... i bought more undervalued rundown houses ... probably like the one you live in now .... and made another $100,000.
"actually .... i bought more undervalued rundown houses ... probably like the one you live in now .... and made another $100,000."
You bought HOUSES as in plural AND you ONLY made 100k?? What type of dipshit ivest-whore are you?? Most invest-whores in the last 5 years racked in minimum 500k-1M on flips. Just shows that you live in some god forsaken shithole. So how is New Orleans doing bitch? Signed...Smug SouthernCalifornia Homeowner who can shit 100k.
Isn't it interesting that none of the white people will answer this question?
I suspect its because they understand that no amount of money can compensate for being mistreated on the basis of color.
Hypothetical Question for the white people:
There is a new compound invented that will turn a white person into a black person FOREVER; it doesn't "wear off".
Now,
How much money would you need to be paid in order for you to take compound and be turned into a black person forever?
All it does is change your appearance, nothing else; if you have an IQ of 160, you keep that.
How much money would you require to be paid in exchange for being classified as a black person?
http://www.counter-racism.com/
"You bought HOUSES as in plural AND you ONLY made 100k?? What type of dipshit ivest-whore are you?? Most invest-whores in the last 5 years racked in minimum 500k-1M on flips. Just shows that you live in some god forsaken shithole. So how is New Orleans doing bitch? Signed...Smug SouthernCalifornia Homeowner who can shit 100k."
you are a touchy one aren't you mr. anonymous? you must hate your life ... haha ... i am loving mine. that is $100k minimum per investment. won't touch it if it is any less. and you are right, $1 million sounds about right for me. you must be mad that you did not make ANY money during the boom. don't worry it will come back around in another 10 years ... i can give you some tips. in the meantime, keep watching those stocks.
Don't you know that the SAT, GMAT, GRE, LSAT and other standardized tests are also racist? At least that's what I've been told
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