Reckless Mortgage Lenders With Criminal Records Slip Through Federal Crackdown

Washington Post:

A crackdown on reckless mortgage lenders by the Federal Housing Administration has failed to root out several executives with criminal records whose firms continue to do business with the agency in violation of federal law, according to government documents, court records and interviews.

The get-tough campaign has also been hamstrung because, even when the FHA can ban mortgage companies for wrongdoing or an excessive default rate, the agency does not have the legal power to stop their executives from landing jobs at other lenders, or open new firms.

Read the whole story: Washington Post

Comments

[norkas]

07:52 PM on 09/13/2010

Here is something I want to share with all of you because I feel like I am living a nightmare.

I friend of mine whose sanity I really question now invited me to view a house he said the real estate agent said he could purchase really cheap.

Little did I know this same agent treated him very badly during the boom when he was interested in purchasing a new home.

He told the agent he wanted to deal with the owners and if he liked the property to take a walk outside so he could feel comfortable speaking to the owners about what they would seriously consider taking as a fair offer.

We went through the house in California that had a great swimming pool and was a beautiful home. The asking price was $3,500,000. My friend David asked the agent to go outside where the pool was so he could speak with the owners.

We all sat at a table and David told the owners he was a little embarrassed about making an offer that the real estate agent said he should give. They asked how much and he opened a notebook with the price of THREE HUNDRED THOUSAND on it.

The people went nuts and I was really nervous my friend told the agent was unbalanced we left quickly.

[BlueSkyPilot]

04:58 PM on 09/13/2010

They don't "Slip through the Cracks" They just walk through the wide open doors that regulators are powerless to close thanks to a lack of laws to give regulators any real power to stop them.

[tuberider]

02:48 PM on 09/13/2010

How about the "ex-pat shadow realtors" down here in Central America? Is anyone pursuing them? Thanks for everything Tio Sam.

[Zeroes]

07:49 PM on 09/12/2010

We had a convicted cocaine dealer jailbird owning and running a mortgage company in the frozen north.

[afgail]

05:44 PM on 09/12/2010

The reason Newt is called a "horse's patoot" is because what he says is horse pucky.

[bmike]

08:29 AM on 09/12/2010

Homes were sold to people that lenders knew they could not pay for them.They knew debt to income ratio said when interest rate move income could not pay for house.That was a form of thief but since nobody goes to jail and Republicans say look forward not backwards and don't play the blame game it will continue.

[Get RealSoon]

12:54 PM on 09/12/2010

Well said.

[jumpstart the economy]

08:04 AM on 09/12/2010

Enough with business, banks and financial institutions - lets put America to work!
Time to help the shrinking middle class!
Main Street Americans can resolve the housing and employment crisis FAST.
How about giving all Americans making less than $250,000yr the option to withdraw retirement savings TAX FREE if they pay CASH for a primary or second home or rent to a foreclosure victim? They must keep the home for at least 3 years or pay the taxes.
This would greatly reduce the foreclosure blight, put cash in the economy, increase consumer confidence and provide much needed employment as well as state and local real estate taxes. Taxes paid by the newly hired would probably make up for the tax incentive.
The best part? NO NEW DEBT
Lets put America back to work!

[Zeroes]

07:51 PM on 09/12/2010

To get the economy going the focus needs to be on the consumer...not big business.

[stape45]

10:39 PM on 09/11/2010

Since the 1980's "checks and balances" has come to mean: the lobbyists write the checks, and the congressmen pad their bank balances.

[2garen]

10:35 AM on 09/12/2010

That pretty well sums it up.

[epforrester]

10:26 PM on 09/11/2010

The libertarian-rebulibagger "free market" continuing to work.

[graymatters]

11:01 PM on 09/11/2010

I didn't know Clinton was a Republican. In 1994 he made banks offer sub prime loans, then told banks that FM/FM would buy those loans wrap them up in securities and sell them to investment houses. Government collusion with business always ends with us the tax payer getting screwed.

If it makes you feel better to be lazy and simplistic go right ahead.

[29bela]

11:18 PM on 09/11/2010

He did it by himself or congress and senate approved it? Which one? Nobody checked it at all?

[she343]

12:56 AM on 09/13/2010

Banks were supposed to offer mortgages people could afford! They criminalized what was supposed to be a help for economy! In '94 you could qualify for a modest house cheaper than you could rent and the folks with good jobs could move up to a nicer house- win, win....then the banks started ru

[ChampLessFuzzy]

09:47 PM on 09/11/2010

There will always be opportunists, there will always be bad people, there will always be only so much the rest of us can do to prevent their actions.

I read once that criminals are much like roaches; they adapt to changes put in place to prevent their success. Build a better lock, they learn how to access or sidestep it; build a better system of security, they learn how to work around it. It's ongoing. Sadness, really.

[29bela]

11:20 PM on 09/11/2010

... and we have to put up with all the new law, rules... over and over again just to change nothing at all!

[52tucker]

07:01 PM on 09/11/2010

Lets put the blame where it belongs: These are the same kind of stooges that kicked the recession into high gear, back to play at the only game they know- bilking those in need of a leg up. Tea Party Patriots like to call that "free enterprise" but we know them to be con men and lowlifes with a nice pressed shirt. I want these crooks nailed and jailed.

[ChampLessFuzzy]

09:49 PM on 09/11/2010

Teapartiers actually celebrate these criminals; next they'll put them up for elected office and vote them in with gusto.

[29bela]

11:22 PM on 09/11/2010

What do you expect when they are so charming, they say what people like to hear, they are bold in promises...

[MyHO]

06:37 PM on 09/11/2010

It's a humongous crack!! How could anyone miss it? My goodness, the fattest fat cat could get through.

[epforrester]

10:25 PM on 09/11/2010

My childish tendencies want to reply to your unintended innuendo.

[Please Pogue Mahone]

06:10 PM on 09/11/2010

I saw the title of the article "Reckless Mortgage Lenders" and saw "criminal" and thought this article would be about Fannie Mae and Freddy Mac. They played a huge role in the financial crisis with all the lending to the unqualified buyers.

I guess they can say the politicians forced them to make the loans because it is also true.

In any case it was criminal on both sides.

[AlsoSarah]

09:49 PM on 09/11/2010

Perhaps, but they are owned by the American Taxpayers now. We own our own mortgages. Cut out the Banks who merely service our mortgages. Reduce interest rates and pay back the taxpayers while reducing the deficit. What? The Banks won't like that?

[Mr Hankey]

05:20 PM on 09/11/2010

http://www.usatoday.com/money/economy/housing/2010-09-10-mortgagemods10_CV_N.htm

[Paisano]

04:00 PM on 09/11/2010

Why is it that no one goes to jail anymore? I literally watch people that we elected break the law and we as a people... do nothing!

[AlsoSarah]

09:53 PM on 09/11/2010

You have to be black, poor, or both to go to jail.