Subprime Suspects

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  • Posted By: mooseNY @ 10/08/2008 9:32:32 AM

    Nice liberal take on it. It was defenisve from the start. THe facts are the facts. If Fannie does not support those loans, they never happen.

    • Posted By: dogboy47 @ 10/08/2008 9:44:10 AM

      The sub-prime and prime loan mess was already happening before Freddie and Fannie got involved. Countrywide and others made these bad loans and threatened to take their business to others unless Freddie and Fannie bought these bad loans. The article was not defensive, it only pointed out the facts.

      • Posted By: CCryder @ 10/08/2008 10:20:55 AM

        Yes, dogboy, but it's not fair to quote the facts because everyone knows that they have a liberal bias.

        "Finance is the art of passing money from hand to hand until it finally disappears."
        - Robert Sarnoff, Son of David Sarnoff, Founder RCA Corporation

  • Posted By: A New York fan @ 10/08/2008 10:16:47 AM

    Posted By: Tgo01 @ 10/08/2008 10:06:24 AM
    Comment: So basically what you're saying is it's everyone's fault EXCEPT those who took out loans with no means of paying for it? I suppose if someone goes to a casino and losses their life savings it's the casinos fault for that too right?
    NO the fault lies with our government for not having the forsight to regulate this before it got out of hand, they were too bogged down with issues like Steroids to care.

  • Posted By: A New York fan @ 10/08/2008 10:14:39 AM

    rrodriguezmiami you are right to a point, remember the head of Fannie Mae and many of our congressional leaders actually believed that home values would continue to rise unabated. They actually believed this and because of this enabled the rules to become lax. Subprime got it's foothold due to the fact that with Fannie and Freddie rules relaxed they could offer the same loan directly to Wall street without PMI these sub prime loans became even more laxed in their qualifying criteria. Remember too the rates on sub prime loans started out lower at one time then Fannie and Freddie loans and looked more attractive to both investors due to the rate adjustment and to buyers because they could now buy a home they wouldn't qualify for before and fro those to refinance their homes like they were ATM's. The Government, Fannie, Freddie Wall Street all betted on home values continuing to climb because of more buyers out their buying. This in itself should wake up boht Conservatives, Liberals and those inbetween that our ENTIRE government failed us and we need to make the changes to our legislature more then anywhere else if we truly want change, and demand more accountability from our Congressman, Senators and President and we need a court that upholds laws not write them. ANd remember it isn't sub prime loans that are the focus of the bailout it is Fannie and Freddie loans as well as banks that have loans both performing and non performing on their books that are now worth pennies on the dollar. Anyone reading this chain that is paying their mortgage on time and not in trouble do you realize that even your loan is a problem on them books of whatever lending institution is holding it. Even good loand right now are not safe.

  • Posted By: A New York fan @ 10/08/2008 9:19:24 AM

    Posted By: pdoff @ 10/08/2008 9:12:04 AM
    Comment: Poor people can't afford their houses not because their poor but because they are charged higher interest rates. Making it impossible to have the American dream the rich get richer as long as they hold poor down on their knees paying rent or living on the tax payers nickel in subsidized housing.

    Interest rates were based on credit score not wealth, to make that comment that poor people were chrged a higher rate because they were poor has a racial overtone. Not all poor people had low credit scores how dare oyu stereotype.

    • Posted By: pdoff @ 10/08/2008 10:13:21 AM

      don't try to make this about race. the poor see no color the fact remains that the poor have lower credit ratings because because they have less of the ability to get credit and or maybe because of were they live they have less of the ability to keep there jobs and keep up their credit. and because of that credit score they are charged more interest keeping poor even poorer. Now if your a poor person with great credit good for you but it doesn't mean your black or white or brown just lucky. Sorry you took offense

  • Posted By: independentcentrist @ 10/08/2008 10:12:55 AM

    AMEN, finally someone in the media who has enough guts to speak the truth. Everyone is blaming it on the subprime. dig deep and past the silly rhetoric. If a banker calls on a poor person who can barely pay monthly rent on a $400 apartment, and tells him here's a $500k loan to buy a one bedroom dilapidated house in a crummy neighborhood in California. That person would take it. what can you loose when you already have nothing to loose. So who's the culprit, the person who has nothing to loose or the banker who gambled their investors and depositors money on a crapshoot loose/loose roulette with that poor person. All tha t so they can fill up their CDOs, SIVs, CDSs, and other junk off-balance-sheets derivatives, that they unloaded on other unsuspecting, stupid (but supposedly sophisticated) investors, and other banks, aided by the rating agencies, who rated thes junk instruments AAA. now tell me that this whole mess was only subprime. wake up people and think for yourselves, instead of listening to the limbaugh's and other propagandists of the world, who's only mission is to dumb-down their listeners and society in general.

  • Posted By: independentcentrist @ 10/08/2008 10:12:21 AM

    AMEN, finally someone in the media who has enough guts to speak the truth. Everyone is blaming it on the subprime. dig deep and past the silly rhetoric. If a banker calls on a poor person who can barely pay monthly rent on a $400 apartment, and tells him here's a $500k loan to buy a one bedroom dilapidated house in a crummy neighborhood in California. That person would take it. what can you loose when you already have nothing to loose

  • Posted By: cl1020s @ 10/08/2008 10:09:12 AM

    The Community Reinvestment Act ALLOWED banks to get involved in this mess. If that legislation hadn't been passed and expanded over the years, the fallout from this mess would be much less widespread, since then only institutions that aren't "banks" could get in bed with these companies with such terrible risk management.

    If your an investment company and want to buy up risky loans to try to make money, so be it. If your a deposit bank useing every jane and joe's savings to do the same, that's a problem. When the first goes broke, only those who choose to invest in such high risk markets get burned. When your banks do it, everyone is trouble.

    Increadible greed by those running this mess is to blame, but our government via the CRA and complete inaction up until it was beyond repair made it possible.

  • Posted By: Tgo01 @ 10/08/2008 10:06:24 AM

    So basically what you're saying is it's everyone's fault EXCEPT those who took out loans with no means of paying for it? I suppose if someone goes to a casino and losses their life savings it's the casinos fault for that too right?

  • Posted By: G83LWH @ 10/08/2008 10:05:19 AM

    Why is a loan to a minority or working class person more risky than to wealth people? Everyone had a role to play in the mess we face today. Yes, everyone. Preditor lending, lack of oversight, and those individuals who fell into the trap of an empty promise. It is easy to place blame. It is much harder to work through the mess and come up with solutions that benefit everyone (homeowners, banks, investors, etc.) It took all the stakeholders to create this mess and it will take helping all the stakeholders to get out of this mess. Again, its easy to place blame. I say "Thank you God, because not for your grace and mercy this could be me."

  • Posted By: Tgo01 @ 10/08/2008 10:05:09 AM

    So basically what you're saying is it's everyone's fault EXCEPT those who took out loans with no means of paying for it? I suppose if someone goes to a casino and losses their life savings it's the casinos fault for that too right?

  • Posted By: G83LWH @ 10/08/2008 10:03:54 AM

    Why is a loan to a minority or working class person more risky than to wealth people? Everyone had a role to play in the mess we face today. Yes, everyone. Preditor lending, lack of oversight, and those individuals who fell into the trap of an empty promise. It is easy to place blame. It is much harder to work through the mess and come up with solutions that benefit everyone (homeowners, banks, investors, etc.) It took all the stakeholders to create this mess and it will take helping all the stakeholders to get out of this mess. Again, its easy to place blame. I say "Thank you God, because not for your grace and mercy this could be me."

  • Posted By: djj51 @ 10/08/2008 10:03:24 AM

    Thank you for setting this matter straight!

  • Posted By: mjacks38 @ 10/08/2008 9:50:08 AM

    @ cayabooks How can you compare a homeless person to someone rich?? What can someone do with $100. How can you expect a homeless person to save, when they have no savings account to put it in. Not to mention, that they probably don't have a roof over their head. You are comparing apples to oranges, therefore you need to think more outside of the "bubble" that you obviously live in.

  • Posted By: rrodriguezmiami @ 10/08/2008 9:43:45 AM

    Yes, loans were made to poor people, but they were poor "working" people. As someone who makes a good income but has bad credit due to a temporary medical disability during which I had no health insurance, I had to refinance my fixed rate mortgage when I defaulted. I was put into an adjustable rate mortgage which ballooned after a year. I ultimately had to sell my house. I work in the legal industry for a law firm that did real estate closings. People really need to know that these "poor" people who were buying homes did qualify under the banks' underwriting standards; the mortgage loans that these people were deliberately put into would become problematic because of the skyrocketing adjustable rates that were built into these loans. The "poor" people weren't put into fixed-rate mortgages because the adjustable rate loans generated more fees to the banks and mortgage brokers. I can not overemphasize how much these banks preyed on and profited immensely off the "poor".

  • Posted By: cayugabooks @ 10/08/2008 8:55:38 AM

    The poorer classes in the United States actually make billions of dollars, but unlike the middle class and the rich they hold onto it less. The marketing of houses to them was in a way to have them hold onto more of their money, but the system didn't change the cyclical exchange of money. So poor people were sold houses that they couldn't hold onto because they simply do not have the financial instruments to do so.

    • Posted By: spideymn @ 10/08/2008 9:06:34 AM

      cayugabooks, you must mean billions due to the fact that there are so many of them making so little. I can agree with that. But if you are suggesting that they make comfortable salaries and simply waste it, than that I flat out wrong. Last I checked minimum wage was still six seventy five an hour. which calculates roughly to 14k a year. hell even at 10 or 11 bucks an hour thats still in the high teens low twenties. So you need quite a few poor folk to even make one billion in a year. The palliative fix to get poor people into homes was asinine at worst and simply naive at best, the real problem lies in their piss poor education and the subsequent piss poor wages they get paid for slave labor.

      • Posted By: cayugabooks @ 10/08/2008 9:40:32 AM

        As a collective the poorer classes make billions of dollars. However, they have no way to hold onto their money and acruse savings and have investments. So money goes into poor neighborhoods but does not stay there. It goes to pay the landlords, corner stores, drugs, crime, etc ... Give a $100 to a poor person ans see how fast they spend the money, as compared to a millionaire, who would take the money and put it in his bank or in an investment. It is not a matter of personal financial know how but simply the system at work. One of the biggest farces played on the poor is that if you buy a house you will no longer be poor. It simply isn't true and it doesn't work that way.

  • Posted By: dave24 @ 10/08/2008 9:39:58 AM

    more propaganda,,,, this whole thing was intentional act of wealth redistribution/reparations, nothing more, and now ithe truth is out and it is so big it must be dealt with. The way I see it is, instead of govt housing, the govt will now own whole medium and high end subdivisions full of non paying individuals. It will all be trashed in a few years anyway, I can see it happening now.

  • Posted By: laarnio @ 10/08/2008 9:39:27 AM

    The American dream is to own a home. The simple fact is that not everyone can own the home they think they deserve and want. Keeping up with the Jones just does not work with home ownership or for that matter with any debit. Unfortunately mortgage bankers took advantage of this dream by telling their clients that they qualified for a huge loan. Of course when you find out you qualify for this huge loan, you look at all the homes that place you on the edge of affordability. Isn't it the responsibility of individuals to look at their financials and make a responsible decision about what they can truly afford? Yes

    We can go around and blame everyone else for this mess; which is not a good solution to any problem. Or we can start by changing our attitudes about the acquisition of material things.

  • Posted By: ArmoredTACO @ 10/08/2008 9:35:43 AM

    "Lending money to poor people doesn't make you poor. Lending money poorly to rich people does."

    D**n straight

  • Posted By: underdog @ 10/08/2008 9:33:06 AM

    It seems that the finanacial industry got hit by lax oversite by the government, cockyness and no ethics on the part of the CEO's of these companies, and no control by the board of directors. The CEO's act like they can do what ever they want with the company because the board is not going to stop them for the short term gains. They rode the companies staight into the ground and no one stopped them. The lax oversight by the government didn't help at all. It seems not only was the oversight lax but Congress didn't want to know. There is an interesting video on YouTube of congressional meetings held 4 years ago. The regulators for Fannie May and Freddie Mac are getting hammered for suggesting that there are problems at these organizations. There seems to be an attitude in Congress of shoot the messenger.

  • Posted By: Chris.L @ 10/08/2008 9:28:18 AM

    I lived in the CA Central Valley in the 80's/ Early 90's and they DID NOT build homes that people could reasonably afford. They flooded the market with McMansions for the Bay Area crowd fleeing the rising prices down there. It wasn't "greedy" homebuyers. There was report after report of low income people being squeezed out as homebuilders made huge profits building homes low income people could not afford. Rents skyrocketed and I had to move out of state. You can live within your means when there are homes available within your means. And then to be bombarded daily buy banks claiming "Don't worry, we'll get you in". It's listen to the smiling guy in in suit, live Southside and risk your kid getting shot, or move. Not much of a choice.

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