“There was always a big financial incentive to make a subprime loan wherever one could.”
-affadavit of Wells Fargo Loan officer
Wells Fargo’s top-producing loan officer testified in court some of the more unsavory and nefarious lending practices WFC engaged in.
Her sworn testimony involved how the bank targeted heavily African American areas for shoddy mortgages and subprime loans, even for people with “sterling credit ratings.” This arose due to Justice Department investigations into Wells Fargo’s alleged fair-lending violations.
Structurally, Wells Fargo provided the sort of misaligned financial incentives that helped to create so much of the crisis.
Regardless, that is a hell of a chart!
Source:
Ex-loan officer claims Wells Fargo targeted black communities for shoddy loans
Ylan Q. Mui
Washington Post, June 12
http://www.washingtonpost.com/business/economy/former-wells-fargo-loan-officer-testifies-in-baltimore-mortgage-lawsuit/2012/06/12/gJQA6EGtXV_story.html
Category: Credit, Legal, Real Estate, Really, really bad calls
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
and ‘people’, still, wonder why? the Sale of Road-kill Stew, encourages Reckless Driving..
or, if one were to ‘Play’ “MSM ‘Reporter’..”Of course that Top Chart (above) is only indicative of Demand..certainly, Not of a Crime..”
Given that the loan bubble of mostly-fraudulent loans represents economic transfers, it stands to reason that, in a zero-sum game, there were those who benefitted from the bubble and those who were sacrificed to it … in a proper accounting, of gains and losses between the banksters, the homeowners of those mortgages, and the rest of the homeowners, and the rest of the taxpaying citizens (renters) in the US, I wonder how it would all sum up? Who won and who lost? Don’t forget the bonuses that were awarded based on loan business dollar volume, and the payoffs to assessors delivering fraudulent assessments as requested, and the lobbyist money flowing into DC to keep the game/scam going …
Remember, this IS a zero-sum game … think about that …we’re talking about a bit less than 800 billion dollars of bubble/excess mortgages at the peak, and an average annual take of something like $300 billion, for about a decade+, ongoing into the future? Even on the downward slide, mortgage industry executives are being compensated based in some way on the amount of mortgages in their company … after all, it requires a more expensive executive to ride herd over all that money, especially if they are mostly non-performing loans …
… somebody got a whole lotta gains, and a whole lotta people got screwed … and nobody is getting prosecuted …
Look at that chart … we’re gonna be processing foreclosures all the way through 2020 … screwing the fall guys all the while … while steadily reducing the prices of existing homes, with or without outstanding mortgages …
I read a few articles about the case against Wells Fargo in Memphis targeting African Americans for subprime loans. Not condoning the actions of Wells in some cases. But what is conveniently left out of articles by media companies with an axe to grind against banks, is that the credit scores of those AA borrowers were often very low and not good enough for prime loans. Pesky little detail the liberal media likes to omit. There may be a few cases where subprime loans were offered to borrowers with scores good enough for prime loans, but in many cases subprime was the only product available because of their scores. Now if Wells DIDN’T lend to them…they would be accused of redlining and denying credit to minorities. But because they lent to them, now they are being accused of predatory lending. Dammed if you do, dammed if you don’t. What a load of bull.