Not exactly getting the JTP treatment, is she? Don’t they vet these people at all?
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Recent Comments
- In The Mailbox: 02.28.23 (Afternoon Edition) : The Other McCain on Hey, longtime pw readers…
- In The Mailbox: 12.23.22 : The Other McCain on Patrick J. Carroll truly IS a sad, embittered psychopath
- Danger on Patrick J. Carroll might be a psychopath
- Danger on Patrick J. Carroll might be a psychopath
- In The Mailbox: 07.18.22 : The Other McCain on Patrick J. Carroll might be a psychopath
“According to real property data search information, Hanks bought the two-story home in the summer of 2001 for $87,000. At some point in the next five years, she re-financed the original home loan for $270,000. ”
I’m sure some eeeeeeevil banker forced her to do this! I mean, if she was only interested in getting a lower rate and maybe pulling a little equity out, why in the world would you take a loan for 3 times the original value? Because there is no shot that the payments even stayed in the same city, let alone ballpark, of what they had been on the original loan…
And this woman, an ACORN hero, is prototypical of an appreciable amount of thise that will be getting relief through Obama’s mortgage bailout plan…
Seriously, based on her income you would think that she would want the payments to stay as low as possible. And even if she took money to fix up the rental in the basement, it certainly didn’t require all that!
People are free to enter into any contracts they like in a free market. And I understand that some folks have lost their jobs and are in trouble circumstantially, and could use a bit of help through a rough time. But clearly this is not a case along those lines…
If you want to live large, when the bill comes due you have to be ready to pay it. I hope that the ACORN worker that facilitated the break in is ready to do just that…
But truthfully, who knows what will happen in the peoples republic of Maryland…
Malkin’s all fascisty with the facts. If she only had a heart, man.
Unless Jay Gatsby was building next door, what bank gives a $270,000 loan with a (allowing for some appreciation) $100,000 home as collateral?
They deserve to both fall.
what bank gives a $270,000 loan
The “Banker with a Heart”.
Lawson, Eugene
The former head of the Community National Bank in Wisconsin, which he bankrupts with his collectivist “humanitarian” loan policies. He then joins the Bureau of Economic Planning and National Resources.
Chances are good it wasn’t a bank that lent the money, Techie. Whatever it was, the system had been created for the near immediate sale of the new (unsustainable) mortgage to another institution, which then bundled or sold it to be bundled with thousands more in a new instrument which in turn is sold again, ending up in hands far from the original issuer of the mortgage. The possibility of eventual failure is thus also far removed from the decision to lend. Those lending entities got paid immediately and pocketed that gain. They are likely gone now however or at the least severely reduced in output, as the source of their business, making and selling mortgages has also dried up. The near complete disconnect of decision lend and consequence in failure is at the heart of the problem we see playing out today.
decision to lend, sorry.
Consumer and investor confidence peg new record lows, again.
The economic confidence level is now significantly lower than it was post-9/11.
Heckuva job, Barky!
So what you’re saying, SBP, is the phrase “We’re from the government, and we’re here to help you” doesn’t instill warm fuzzies and feelings of euphoria in the general population?
Sure, Spies. Let’s see, last name Garcia? Now should I turn down this loan and have 50 La Raza afficionados bringing Hispanic culture to my front lobby ( or lawn ) while the bank regulators wonder if this is evidence of redlining under the CRA and some judge and OJ jury wonder if I just hate brown people 50 million worth? Or just let it go through?
Gee, what’s the system bias there? Bob, there’s your answer on what kind of bank: a government run one. From the 70’s.
To bastardize Johnson(?) on Christianity, the problem with the free market is not that it’s been tried and found wanting, it’s been found difficult and left untried.
As Billy Mays would put it; “And it gets even better”.
Single mom bus-driver takes out $800,000 (WTF!?!) mortgage and now frets that the home value won’t let her refinance? Plus she wants Obama to “Stop the foreclosures”? The video along with the story is priceless. My apartment isn’t as nice as that (nice stone counter tops, Minta), what the hell am I supposed to do about it?
Maybe we should make it harder to get credit (I denounce myself), so that the lender won’t make it “too easy” to get “too much house”.
Via HotAir: http://hotair.com/archives/2009/02/23/video-bail-me-out-obama/
Don’t all these stories remind anyone of the, buying stock on margin in anticipation of quick gains, that turned the market downturn in 1929 into a crash?
Foreclosures notices are margin calls. Evictions are the liquidating of a margin position.
Eviction and sale.
“What do we have for her, Johnny?”
“A charge of breaking and entering, good for a full five-year stretch, Dan!”
The change from mark to model accounting to mark to market caused an instantaneous margin call all around, it seems to me, geoffb.
At least one can fit in a Ghostbusters reference ih:
Egon: “For your information Ray, the interest alone for the first five years comes to $95,000.â€
Venkman: “You’re not gonna lose the house, everyone has three mortgages nowadays…â€
Techie: “They deserve to both fall.” Why does the bank deserve to fall? // They were SHAKEN DOWN by Fannie Mae (Barney Frank, Christopher Dodd, etc.), and FORCED to write bad loans. They were told that they’d be SUED, FINED, etc. if they did not write them and that the toxicity of the mortgage wasn’t a valid excuse because the loan was … underwritten by the US government. Liberals are quick to point out that this is example of why a free market does not work to which I respond – until I am free to NOT pay taxes …. this is NOT an example of a ‘free market’ because those ARE my taxes and yours!
No they weren’t Mike. here</a
I mean unless Fannie and Freddy were “forcing” people to lend second mortgages (worth three times a home’s value!). “Damn government, making me broker this loan so I’s can buy a BMV!”
Nice conspiracy theory, though. it was the evil guvmint and their loans to poor people who created a 30 to 1 leverage value at Bear Stearns. Makes you wonder how many poor people live in Fort Myers, Las Vegas, and Phoenix?
HA
The push that shoved the whole thing over the cliff.
Put a system into a critical state and even a small push will cause it to collapse. And “Mark to Market” wasn’t a small shove. CRA, Fannie/Freddie, Dodd/Frank, put it in the critical state.
Dammit, Ted, this is gonna be hard enough to fix, and we don’t need you and the rest of the apologists dragging out strawmen to rage against.
The “tranche” system was a pure and ideal application of the notion of affirmative action. Out of hundreds of mortgage applicants, many could pay, many more could at least service the loan, and only a few were pure deadbeats either unwilling or unable to pay. Investors could pay a lot and get first shot at the ones who could and would pay, all the way down to those who paid a little but stood to make a killing if the low-quality borrowers came through.
The problem was, and remains, that both politicians and bankers started regarding the system as a cash cow — politicians insisted on more and more low-quality borrowers be admitted into the system, and bankers went along because of the perception that the Government would cover their asses. And with all that money floating around, just about everybody in the system saw nothing wrong with siphoning off just a little bit to help themselves — but, like all salami schemes, eventually the last slice goes through the machine and nothing’s left.
Curse the bankers if you like; I do. But ignoring the continual, additional requirements laid on by the political system is leaving out at least half the problem.
Regards,
Ric
They were SHAKEN DOWN by Fannie Mae (Barney Frank, Christopher Dodd, etc.), and FORCED to write bad loans.
Well… sort of.
Banks aren’t forced to be in the mortgage business at all, really.
The fact that the government set the business up to be crooked doesn’t necessarily excuse those who chose to take part in the crooked business.
Fannie and Freddie created a market for sub-prime loans. CRA and ACORN created pressure to make the sub-prime loans.
Pressure to make the loans and a willing buyer who will take them off your hands, who wouldn’t make the loans.
Then the Fan/Fred duo take those sub-primes and create the CDO’s and CMO’s that with the implied backing of the Federal Government spread the toxin throughout the world of finance.
This balanced the whole system on the pinhead of house values always rising. A system in a critical state. One bump and it blows up. Stupidity, avarice and unquenchable thirst for power. Perfect combination.
Pressure to make the loans and a willing buyer who will take them off your hands, who wouldn’t make the loans.
Someone with integrity and a sense of business ethics?
But under the contours of the system posited SBP, aren’t operators like that “with integrity and etc.” otherwise known as chumps?
Those, perhaps, are the mortgage lenders who will still be in business when this is over except that, the Obama administration is helping the crooked ones out, and making the rest of us foot the bill.
Rinse, repeat, TARP # whatever.
But under the contours of the system posited SBP, aren’t operators like that “with integrity and etc.†otherwise known as chumps?
I guess, just like I’m a chump for being current on my mortgage and student loans.
I’d rather be an honest chump than a crooked winner, myself.
Da*n, I hate going into work feeling mad.
Later.
Chump here too.
“Then the Fan/Fred duo take those sub-primes and create the CDO’s and CMO’s”
Slightest of nits: FM/FM didn’t create CDOs and CMOs, I-Banks did. But this is spot on:
I’m not sure if it was mentioned on Malkin’s site (I think it was)- there was another case with BUS DRIVER who bought an 870k home, which plumetted in value to 675ish. Her excuse was the lender let her borrow that much money.
No responsibility = thewinz.
I feel the same way SBP. But business isn’t generally done on a personal view of ethics and responsibility. Incorporation is designed to see to it, isn’t it?
I’d be OK with every fraudulent borrower and lender serving their entire sentence without possibility of parole.
Oh, wait, they’re walking away with the money…
Leave us not forget the “securities rating” companies that put a AAA mark on the bundled turds.
Thanks kelly.
#30
Not just Malkin’s site, the story broke/was on CNN.
I found this May 2001 article which has these paragraphs. My bolding.
And this from November 2000.
Which makes me think I was right about the FM/FM involvement in CDO’s and CMO’s. Maybe others did package them but FM/FM provided the model and the securitizing that was needed to get the AAA ratings for these poisonous papers.
MBS are not the same as CDOs. CMOs are MBS, though. CDOs and CLOs are derivatives.
Could it be said that part of the debt that a CDO derives it’s value from can be MBS, along with bonds and other non mortgage loans? Can it also be said that the failure in the MBS’s spread to the CDO’s and was a, or perhaps the, major cause of their problems?
Yes, just so.
Thank you kelly, PW is a learning kind of place.