Here’s the narrative drive-bys use to explain the rash of foreclosures: Unsuspecting, goodhearted people with a desire to own a home…walked into a lending institution, where evil predators sized them up, then exploited them — pushing them into mortgage deals they didn’t understand. When interest rates rose, these goodhearted people were thrown out of their homes, forced onto the street, waiting for a bailout.
We’ve now learned that a significant portion of those who defaulted on their mortgages and were given help — have gone into default…again.
Now, more news. Federal prosecutors have been making hundreds of arrests around the country – rooting out brokers and other lenders involved in writing bad mortgages. Some are accused of taking kickbacks, bribes, and falsifying documents. But, sadly, another troubling aspect has emerged in all this corruption. Contrary to the narrative, predatory lenders were not the only “bad actors” in this scheme. In some cases, the “goodhearted” potential homeowners went so far as to create fake identities to purchase their homes.
The FBI says about 80 percent of mortgage fraud cases involve insiders; but the other 20 percent involve individual borrowers, who got what are called “liar loans.” They lied about their income, job history, or something else in order to qualify.
But the biggest liars and fraud-brokers in this entire scandal…aren’t under investigation. They’re sitting in Congress; they’re the Democrats who set up this fraudulent business model and refused to reform it. And, they’re unaccountable. As usual.
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