Banks are still fueling the fire

Published: March 4, 2008, 12:07 pm

Tags: mortgage musings, fraudulent loans, liar loans, mortgage fraud, stated income, stated income loans

God bless the account executives for banks that have put me on their rate sheet and promo distribution email lists without my permission. Without their blatant spamming of my email account (I guess they assume that since they read Blown Mortgage that I must be interested in their product offering) I would never come across these gems. This email that I am about to share is overly typical. It shows you in black and white that the conflict of interest of sales vs. sensible lending is alive and well even in the midst of a underwriting tightening. Bank account executives who need to make their numbers push the most aggressive of their underwriting guidelines to their brokers in the hopes of winning loans. They allude to fraud, they promote the idea of “getting away with” fraudulent information on loan applications. They push the most aggressive (and least common-sense) of all of their loan products. The mortgage mess will not get better until these practices are cleaned

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