Who casued the Sub prime mess?

[truthmatters]

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html?nav=rss_opinion/columns

Eliot Spitzer explains.


They used and arcane law to stop the states from battling the people who were using preditory lending.



Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.





But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation.

[jimnyc]

Jesus, you are a broken record. Always looking to blame instead of expecting consumers to make proper decisions. How many threads are you going to start about this? Why not update one of the threads you started in the past about this issue, or are you afraid the readers might see your prior posts and how you were already made to look like an ass?

[truthmatters]

The administration blocked the states own attempts to protect the consumer from preditory lending. They stopped an investigation into the issue. They wanted it to continue so they could bouy up the economy for reelection.

They aided and abetted the destruction of our economy to aviod losing office.

This is what your party does when its in control.

[jimnyc]

"Blah, blah, blah - I'll just ramble like a deranged lunatic rather than answering your question"

Please, list for me all the legislation brought forth by Democrats that would have fixed the issue...

[truthmatters]

Spitzer is a democrat.

He had his attempts to deal with it on a state level trumped by the Bush admin.

They actively twarted any attempt to stop the problem.

[jimnyc]

Spitzer is a democrat.

He had his attempts to deal with it on a state level trumped by the Bush admin.

They actively twarted any attempt to stop the problem.

This is a nationwide issue. Please list, like I have asked already, the legislation that has been brought forth in our federal government by Democrats to fix the issue.

As for NY, it's a Democrat ran state that brought the issue here. His attempts weren't "thwarted" as you state, but rather it's not the governments job to regulate the industry. You've been told this repeatedly but continue to spout off like a mongoloid.

[truthmatters]

http://www.nytimes.com/2007/09/16/washington/16regulate.html?_r=1&adxnnl=1&oref=slogin&adxnnlx=1203181896-ajZOi9h8Kd/mNTabXoCkVw

Funny the industries seem to think it is the job of the feds.





"Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government"

[5stringJeff]

TM, the people who unwisely borrowed too much money are the ones to blame for the "subprime mess." You borrow too much, you can't keep up the payments, and you get foreclosed on. It's not that hard.

[jimnyc]

http://www.nytimes.com/2007/09/16/washington/16regulate.html?_r=1&adxnnl=1&oref=slogin&adxnnlx=1203181896-ajZOi9h8Kd/mNTabXoCkVw

Funny the industries seem to think it is the job of the feds.





"Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government"

Are you too dense to even read your own articles? Some states WANT the government to regulate things, but as it stands it is up to the individual states to regulate at this time. It is NOT currently the governments job to regulate the loan industry that you are trying to blame on Republicans. Funny though, Democrats have left the regulation up to the states too. And even funnier that you keep mentioning Spitzer and NY, when it's the Democrats there who made such a mess. And now you want to blame others for their mistakes.

I'm done with you. You are like debating with a hard boiled egg.

[truthmatters]

TM, the people who unwisely borrowed too much money are the ones to blame for the "subprime mess." You borrow too much, you can't keep up the payments, and you get foreclosed on. It's not that hard.


You have to ignore all this evidence to say that.

If you like to believe things are just simple then go ahead. It does not make you right it just makes you wrong by choice.



Then who are these people and why did the Bush admin use them to shut down state laws and investigations into the abuse of sub primes for years?
http://www.occ.treas.gov/

[jimnyc]

The never ending voice of a hard boiled egg. Hilarious! :laugh2:

[5stringJeff]

Ignore what evidence? That people bought homes that they couldn't afford? That the transactions that have occurred are part of the free market? That Eliot Spitzer is an ultra-regulator who thinks the government always knows better than business?

People made their own choices, and people need to live with the consequences of their choices.

[truthmatters]

Ignore what evidence? That people bought homes that they couldn't afford? That the transactions that have occurred are part of the free market? That Eliot Spitzer is an ultra-regulator who thinks the government always knows better than business?

People made their own choices, and people need to live with the consequences of their choices.


Do you have ANY comment on the article or did you just ignore it?

[Dilloduck]

Do you have ANY comment on the article or did you just ignore it?

Quit trusting the govt to get anything right and you'll be OK. You're naive whining is getting OLD.

[manu1959]

Quit trusting the govt to get anything right and you'll be OK. You're naive whining is getting OLD.

they want the govt to control everything......how about this....name one thing the govt does well....

[Dilloduck]

they want the govt to control everything......how about this....name one thing the govt does well....

Ironic how the people who bitch about the govt are the very same ones who are gonig to vote for socialists. Insane.

[JohnDoe]

Seems to me from what is being presented, the gvt WAS doing something RIGHT until they let regulations basically collapse as of 2003, no?

[Dilloduck]

Seems to me from what is being presented, the gvt WAS doing something RIGHT until they let regulations basically collapse as of 2003, no?

so they get lucky once in awhile --

[manu1959]

Seems to me from what is being presented, the gvt WAS doing something RIGHT until they let regulations basically collapse as of 2003, no?

sub primes loans made buying my house in california possible.....have refinanced with sub prime arms a couple of times since.....i know several other people that have benefited from these loans.....

[JohnDoe]

sub primes loans made buying my house in california possible.....have refinanced with sub prime arms a couple of times since.....i know several other people that have benefited from these loans.....And there is no reason why someone like you should not have qualified for one of those subprime loans either, and be able to requalify for a fixed loan when the shit hits the fan either....never said that....but THAT IS NOT what is going on here or IS NOT what has gone on here, period.

jd

[manu1959]

And there is no reason why someone like you should not have qualified for one of those subprime loans either, and be able to requalify for a fixed loan when the shit hits the fan either....never said that....but THAT IS NOT what is going on here or IS NOT what has gone on here, period.

jd

25% of the forclosed loans were taken out by investors and speculators.....

care to guess the percentage of total sub prime loans that were successful....

how many were a result of the borrower overreaching.....

know where the biggest melt down is......

[truthmatters]

amazing!


The federal government thwarts the states from trying to legislate and investigate in their own state and you people end up defending them.


Funny that .

[manu1959]

amazing!

The federal government thwarts the states from trying to legislate and investigate in their own state and you people end up defending them.

Funny that .

yes us evil capitalists believ in the free market and the intelligence of the individual......and those that may have broken lending laws are being investigated.....or at least they will be once they are done investigating baseball and football...

[truthmatters]

So its just fine with you that the federal gov stopped 49 states attempts to protect their own markets from this mess?

[manu1959]

So its just fine with you that the federal gov stopped 49 states attempts to protect their own markets from this mess?

i don't believe in government regulation of the free market.....if someone wants to sell shit and people are stupid and buy it when they shouldn't....tough......

[red states rule]

So its just fine with you that the federal gov stopped 49 states attempts to protect their own markets from this mess?

The Feds have no right to step in. this is a private matter between the borrower and the mortage company

With the recent interest rate cuts, h/o's are calling in to refi their loans in huge numbers

The so called crisis is fixing itself - and people are dumping thier ARM's and getting fixed rates. and people with huigh fixed rates are getting lower rates

I am always amazed how libs will always look to the government to bail them out of the bad decisions they made in life - then whine when people object to the government when they are refused

[truthmatters]

http://www.usconstitution.net/xconst_A1Sec8.html

read the third power listed.

You are wrong.

[5stringJeff]

Do you have ANY comment on the article or did you just ignore it?

I read the whole thing. It was an op-ed from America's #1 regulator. I disagree with Spitzer's argument that it's Bush's fault that people were duped. I hold people responsible for their own actions.

[manu1959]

http://www.usconstitution.net/xconst_A1Sec8.html

read the third power listed.

You are wrong.

regulating commerce between and among states is not the same as preventing high risk loans from being sold......

[avatar4321]

The people who caused the sub prime mess are the idiots who borrowed money without figuring out how they were going to pay it back. As long as you continue to try to blame someone other than the people who took out the loans, the longer we will face the problem.

This is the problem with liberals. They seek to blame everyone but the people actually responsible. Rather than trying to fix the actual problem, they would rather treat symptoms of the problem and exalt the actual problem as something we should want to see more of.

This is why socialism, which is the philosophy behind so-called "liberalism" will always bring destruction.

[avatar4321]

they want the govt to control everything......how about this....name one thing the govt does well....

breaks stuff and hurts people.

[avatar4321]

Ironic how the people who bitch about the govt are the very same ones who are gonig to vote for socialists. Insane.

it really is isnt it? The government is doing such a horrible job so lets make the government responsible for more stuff it has no business dealing with. Their logic just doesn't make sense.

[Dilloduck]

it really is isnt it? The government is doing such a horrible job so lets make the government responsible for more stuff it has no business dealing with. Their logic just doesn't make sense.

Refuse to take responsibility for themselves yet demand that someone else do it for them perfectly. Why ??? because they pay taxes !!!!:laugh2::laugh2:

[avatar4321]

regulating commerce between and among states is not the same as preventing high risk loans from being sold......

Socialists seem to think the commerce power of the Constitution is broader than it actually is. Don't get me wrong, it's pretty broad even in a conservative look at it, but it's not as broad enough to justify every single solitary act of Congress.

[avatar4321]

Refuse to take responsibility for themselves yet demand that someone else do it for them perfectly. Why ??? because they pay taxes !!!!:laugh2::laugh2:

no they dont. The "rich" do.

[manu1959]

Socialists seem to think the commerce power of the Constitution is broader than it actually is. Don't get me wrong, it's pretty broad even in a conservative look at it, but it's not as broad enough to justify every single solitary act of Congress.

i am not saying there should be no rules either.....but stupid people sold stupid things to stupid people....only the stupid were hurt......

[avatar4321]

i am not saying there should be no rules either.....but stupid people sold stupid things to stupid people....only the stupid were hurt......

unfortunately the smart people get hurt by the economic problems the stupid people cause. of course if the smart people are organized enough they can survive it.

[manu1959]

unfortunately the smart people get hurt by the economic problems the stupid people cause. of course if the smart people are organized enough they can survive it.


that is the price you pay for a free market......risk and reward.....

[avatar4321]

that is the price you pay for a free market......risk and reward.....

yeah i know. without it, there would be no reward and all risk.

[Hobbit]

TM, that clause refers to regulating commerce as it occurs across state lines. Except for loans where people crossed state lines to take them out, the federal government has no constitutional grounds to regulate any loan.

As for the blame, it lies solely on those who chose to spend more than they made and borrow more than they could pay back. Lots of people even lied about their income so the bank would actually loan them money.

[truthmatters]

regulating commerce between and among states is not the same as preventing high risk loans from being sold......

The selling of a loan is commerce.

Very few of the lenders opperate in one state only.



http://en.wikipedia.org/wiki/Comptroller_of_the_Currency

[manu1959]

The selling of a loan is commerce.

Very few of the lenders opperate in one state only.

http://en.wikipedia.org/wiki/Comptroller_of_the_Currency

it is not interstate commerce between states.....

[manu1959]

so houses that once cost 400,000 and forclosed on....were sold at auction today for 150,000......one man's loss is another man's gain.....

[JohnDoe]

i am not saying there should be no rules either.....but stupid people sold stupid things to stupid people....only the stupid were hurt......
yeah, yeah, that's what this is all about...

Stupid is, as stupid does.

Genius! :slap:

Wonder why they all weren't this "stupid" back in the 90's when buying homes? hmmmmmm..... ?

jd

[manu1959]

yeah, yeah, that's what this is all about...

Stupid is, as stupid does.

Genius! :slap:

Wonder why they all weren't this "stupid" back in the 90's when buying homes? hmmmmmm..... ?

jd

there were risk loans in the 90s....there have always been risky loans.....

[truthmatters]

http://legal-dictionary.thefreedictionary.com/Interstate+commerce


Please read the definition

[manu1959]

http://legal-dictionary.thefreedictionary.com/Interstate+commerce


Please read the definition

ok....now your turn.....thank you for finding that and proooooooooooooooving my point.....

[JohnDoe]

there were risk loans in the 90s....there have always been risky loans.....Sure there were, and every loan is a risk for the person that loans it, and that is why interest rates fluctuate between high credit score borrowers and those with low scores, it is a "calculated risk" as they say....at least that was my understanding of it?

Did we have some "financial CRISIS" and "home market crashing CRISIS" because of the multitude of risky loans that were handed out like they were candy to ANYONE in the 90's? I don't seem to remember any, so how exactly does your comment fit in to what is happening now Manu....did i miss something? Or were you just trying to make the point that risky loans have always been out there? what?

jd

[actsnoblemartin]

your both right,

the government's job is to protect consumers from predatory lenders, and it is also the consumers job to use their brains

so technically, your both right

[avatar4321]

The selling of a loan is commerce.

Very few of the lenders opperate in one state only.



http://en.wikipedia.org/wiki/Comptroller_of_the_Currency

actually, i think it falls under the category of finance.

[red states rule]

Sure there were, and every loan is a risk for the person that loans it, and that is why interest rates fluctuate between high credit score borrowers and those with low scores, it is a "calculated risk" as they say....at least that was my understanding of it?

Did we have some "financial CRISIS" and "home market crashing CRISIS" because of the multitude of risky loans that were handed out like they were candy to ANYONE in the 90's? I don't seem to remember any, so how exactly does your comment fit in to what is happening now Manu....did i miss something? Or were you just trying to make the point that risky loans have always been out there? what?

jd

JD, how can their be a "crisis" when only about 5% of homeowners are late with their payment?

This is another manufactured crisis by the left in an atttempt to score political poionts and expand government power

[JohnDoe]

JD, how can their be a "crisis" when only about 5% of homeowners are late with their payment?

This is another manufactured crisis by the left in an atttempt to score political poionts and expand government powerbecause.... there is years of it to come...the zero down/no/low interest, adjustable rate loans were staggered on when the interest would kick in, they all haven't been faced yet, while the higher payments come due and the market for home sale prices continues to fall...., these people WILL NOT be able to refinance their homes AS THEY WERE TOLD that they would be able to do when they first took out their zero interest mortgages, BECAUSE NOW their home values have dropped and their homes are not worth the money that they need to borrow to pay off the adjustable rate mortgage they got just a few years back.

Those that had taken the no/low interest loans were sold a bill of goods about refinancing easily down the road... (in the last week i have seen no less than 6 different HGTV shows that put first time home owners in to zero interest loans...and these were smart, educated couples) adjustable upwards in 5 years or 10 years etc and went with the flow of the market mood, which was excellent at the time...home prices kept rising, appraisers kept up with the rising values almost as though they were in cahoots with the realtors and the mortgage lenders, people kept buying them, all was good.... which was the key to keeping afloat this scheme.... They were told that the way homes kept trending in price, in 5 years when the adjustable interest rates go up on thier mortgage, they would have at least 20% equity in to their home and be able to refinance easily and without PMI even....saving them money.

Well hells bells, that worked out real well didn't it?

Plus, there is no equity left in existing homes to borrow on, which is what actually kept our economy looking (outwardly) decent the past few years...

jd

[red states rule]

because.... there is years of it to come...the zero down/no/low interest, adjustable rate loans were staggered on when the interest would kick in, they all haven't been faced yet, while the higher payments come due and the market for home sale prices continues to fall...., these people WILL NOT be able to refinance their homes AS THEY WERE TOLD that they would be able to do when they first took out their zero interest mortgages, BECAUSE NOW their home values have dropped and their homes are not worth the money that they need to borrow to pay off the adjustable rate mortgage they got just a few years back.

Those that had taken the no/low interest loans were sold a bill of goods about refinancing easily down the road... (in the last week i have seen no less than 6 different HGTV shows that put first time home owners in to zero interest loans...and these were smart, educated couples) adjustable upwards in 5 years or 10 years etc and went with the flow of the market mood, which was excellent at the time...home prices kept rising, appraisers kept up with the rising values almost as though they were in cahoots with the realtors and the mortgage lenders, people kept buying them, all was good.... which was the key to keeping afloat this scheme.... They were told that the way homes kept trending in price, in 5 years when the adjustable interest rates go up on thier mortgage, they would have at least 20% equity in to their home and be able to refinance easily and without PMI even....saving them money.

Well hells bells, that worked out real well didn't it?

Plus, there is no equity left in existing homes to borrow on, which is what actually kept our economy looking (outwardly) decent the past few years...

jd

JD, folks CAN refi their loans. If their is a PPP - it can be rolled over into the loan amount. Some of these refi's can be done with zero closing costs

People are not stuck, and the government has no business sticking its nose into a private contract. Nobody forced anyone to sign the note, nobody held a gun to the borrowers head

Once again, libs think it is the repsonsibility of the Federal government to save people from the choices they made in life

What is next JD, a Federal progtam to save people from losing their cars to the repo man?

Or defaulting on their credit cards?

[diuretic]

The people who caused the sub prime mess are the idiots who borrowed money without figuring out how they were going to pay it back. As long as you continue to try to blame someone other than the people who took out the loans, the longer we will face the problem.

This is the problem with liberals. They seek to blame everyone but the people actually responsible. Rather than trying to fix the actual problem, they would rather treat symptoms of the problem and exalt the actual problem as something we should want to see more of.

This is why socialism, which is the philosophy behind so-called "liberalism" will always bring destruction.

If the opportunities weren't there to borrow then there would be no mess. Look at the creatures who dreamed the scheme(s) up in the first place. Or would you have them totally absolved? That's a bit like the 18th Century English common law judges who refused to recognise fraud as a crime against individuals, preferring instead to use exactly your reasoning - that if someone was tricked then that's their bad luck for being foolish.

http://michaelperelman.files.wordpress.com/2008/02/presentation1.pps

[truthmatters]

Laws are all designed to protect people from some type of abuse.

The 1999 GBL act I mentioned in the thread was represented as a consumer infromation protection act and in that was a section which allowed for the banking industry to buy up enterprise which they had not been allowed to purchase for years. In a few short years this issue grew into the the Sub prime thing we are facing.. It allowed for someone to profit off these loans and to hide the fudging they were doing on the numbers in the loans and then to package them for sell in a way the hid the number if risky loans in the packages.

If the law had not contained this section no one could have profited from the loans in any real way. They were loans which did not make the lender big bucks so they used them sparingly. After the 1999 GBL act changed the way they could do busniess and the result was the sub prime raise.

[avatar4321]

If the opportunities weren't there to borrow then there would be no mess. Look at the creatures who dreamed the scheme(s) up in the first place. Or would you have them totally absolved? That's a bit like the 18th Century English common law judges who refused to recognise fraud as a crime against individuals, preferring instead to use exactly your reasoning - that if someone was tricked then that's their bad luck for being foolish.

http://michaelperelman.files.wordpress.com/2008/02/presentation1.pps

They werent tricked. they were stupid. and it's not the people who suffer. its the lenders who wont ever get their money back.

[JohnDoe]

They werent tricked. they were stupid. and it's not the people who suffer. its the lenders who wont ever get their money back.

So, let me get this straight....

In your land of logic, the people that borrowed the money, on promises and stories given to them by their lenders, that they could easily refinance their loans before they adjust to a higher rate.... and that they would even have substantial equity in to their homes at that time with the way the real estate market was rising, which could allow them to get a good fixed rate mortgage are the stupid ones?

And that these Lenders that sold them this song and a dance, and these lenders that made billions if not trillions off of fees and points and closing costs to all of these people, that should never had even qualified for the mortgage that the lenders gave them in the first place because of their very high risk, are the SMART ones and the ones that are hurting NOW because they were so SMART with their business decisions???

:laugh2:

ok, you need to rethink that Avatar...imho.

[red states rule]

So, let me get this straight....

In your land of logic, the people that borrowed the money, on promises and stories given to them by their lenders, that they could easily refinance their loans before they adjust to a higher rate.... and that they would even have substantial equity in to their homes at that time with the way the real estate market was rising, which could allow them to get a good fixed rate mortgage are the stupid ones?

And that these Lenders that sold them this song and a dance, and these lenders that made billions if not trillions off of fees and points and closing costs to all of these people, that should never had even qualified for the mortgage that the lenders gave them in the first place because of their very high risk, are the SMART ones and the ones that are hurting NOW because they were so SMART with their business decisions???

:laugh2:

ok, you need to rethink that Avatar...imho.

JD, These people can and are refiing their loans

I remember years back, the left was screaming how lenders were too strict with thier lending requirement - and even played the race card

[truthmatters]

Why would anyone refi a loan on a house with no equity in it?

[Nukeman]

Why would anyone refi a loan on a house with no equity in it?
TO GET A LOWER STABLE RATE!!!!!!!!!!!!!

So it won't be a "ballon payment", so it won't be a ARM.... etc...etc.... So they can get themselves out of the mess they put themselves in......:slap:

[Nukeman]

Why would anyone refi a loan on a house with no equity in it?
You might as well ask why anyone would buy a house with no money down since after all they will hae NO EQUITY in it!!!

I'm done with you last timeI comment on something with you, you just argue for aguements sake.....

[JohnDoe]

JD, These people can and are refiing their loans

I remember years back, the left was screaming how lenders were too strict with thier lending requirement - and even played the race card

Hey Rsr!

yes, many are able to do such, and i am greatful for this, but many are not able to also....though supposedly steps are being taken to address this also....it still has a grand effect on the recession coming.

many people in the last 6 years have been spending with the money they got in loans off the equity they had in their homes from the real estate price rises. These are no longer there for most of the country and many people that have bought within the last 5 years are probably holding a mortgage that is worth more than their house is worth now....

housing prices will continue to drop because more and more people with these adjustable mortgages will be putting their houses up for sale on the market....this has and will continue to flood the market with excess inventory, causing home prices and values to go down even futher... giving a negative feeling to the citizens that took out home equity loans that have now turned them in to the red, (upside down) on their homes....alot of this is mental too... how people perceive things when really it is all just on paper.... but this could cause people to tighten up and spend less...

Until, one day, the whole country will think that homes are a great value and that the drops on homes will not continue anymore and it is a good time to invest in them again and we start a new positive cycle i suppose...

jd

[red states rule]

Hey Rsr!

yes, many are able to do such, and i am greatful for this, but many are not able to also....though supposedly steps are being taken to address this also....it still has a grand effect on the recession coming.

many people in the last 6 years have been spending with the money they got in loans off the equity they had in their homes from the real estate price rises. These are no longer there for most of the country and many people that have bought within the last 5 years are probably holding a mortgage that is worth more than their house is worth now....

housing prices will continue to drop because more and more people with these adjustable mortgages will be putting their houses up for sale on the market....this has and will continue to flood the market with excess inventory, causing home prices and values to go down even futher... giving a negative feeling to the citizens that took out home equity loans that have now turned them in to the red, (upside down) on their homes....alot of this is mental too... how people perceive things when really it is all just on paper.... but this could cause people to tighten up and spend less...

Until, one day, the whole country will think that homes are a great value and that the drops on homes will not continue anymore and it is a good time to invest in them again and we start a new positive cycle i suppose...

jd

JD,

With lower interest rates more people are leigible to buy thier first home - or people are able to buy their 2nd or vacation home

It is not all the doom and gloom the liberal media would have you believe

The bottom line is, this is another manufactured crisis by the left and they are using it to move in on banks and mortgage companies where they have no authority to do so

[truthmatters]

You might as well ask why anyone would buy a house with no money down since after all they will hae NO EQUITY in it!!!

I'm done with you last timeI comment on something with you, you just argue for aguements sake.....



You see that has an answer. You buy it when the market is on a steady run up in prices. You hang on to it for two years and then sell it at a profit without ever paying the higher interest rate. Many made money doing so. Some got caught up in it and got stuck with houses that did not go up in price and now are sitting on a house they cant refi because it is worth less than they owe.

Now why dont you acctually answer what I asked I answered your question?.

[theHawk]

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html?nav=rss_opinion/columns

Eliot Spitzer explains.


They used and arcane law to stop the states from battling the people who were using preditory lending.



Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.





But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation.


Its too bad that the current Comptroller was appointed in Aug 2005, the previous one which served during the "height of the crisis" in 2003, was a Comptroller that was appointed under President Clinton's term, not Bush's.



Mr. Hawke was appointed as Under Secretary of the Treasury for Domestic Finance and served in that position for three and one-half years. He was sworn in as the 28th Comptroller of the Currency on December 8, 1998. After serving for 10 months under a recess appointment, he was sworn in for a full five-year term as Comptroller on October 13, 1999.

http://www.arnoldporter.com/press_releases.cfm?u=FormerComptrollerofCurrencyJo hnHawkeReJoinsArnoldPorterLLP&action=view&id=122

[manu1959]

Why would anyone refi a loan on a house with no equity in it?

get a better rate and lower payment.....or take two loans and combine them into one....

[truthmatters]

Its too bad that the current Comptroller was appointed in Aug 2005, the previous one which served during the "height of the crisis" in 2003, was a Comptroller that was appointed under President Clinton's term, not Bush's.




http://www.arnoldporter.com/press_releases.cfm?u=FormerComptrollerofCurrencyJo hnHawkeReJoinsArnoldPorterLLP&action=view&id=122
Report: Subprime probe gets cooperation
Investigation looking at if banks hid information about high-risk loans



updated 10:53 a.m. PT, Sun., Jan. 27, 2008
ALBANY, N.Y. - A company that analyzed the quality of subprime mortgages for investment banks has agreed to provide the New York attorney general with information for an investigation, a newspaper reported Saturday.

The agreement involves Clayton Holdings, of Shelton, Conn., a publicly held company that is a major provider of mortgage due diligence services to investment banks, The New York Times reported. Clayton was provided immunity from civil and criminal prosecution although there was no evidence of its wrongdoing, according to the newspaper.

Clayton has told the prosecutors that starting in 2005 it saw a significant deterioration of lending standards and a parallel jump in lending exceptions. At issue is what information about the quality and risk of the loans was given to the investment banks and what was given to the rating agencies.








http://www.msnbc.msn.com/id/22865876/

[Nukeman]

You see that has an answer. You buy it when the market is on a steady run up in prices. You hang on to it for two years and then sell it at a profit without ever paying the higher interest rate. Many made money doing so. Some got caught up in it and got stuck with houses that did not go up in price and now are sitting on a house they cant refi because it is worth less than they owe.

Now why dont you acctually answer what I asked I answered your question?.
Try reading POST # 60 it did answer yoru question.

To address your concern here about owning a house for only 2 years is absolutely nuts. In MOST of the country where there was not this HUGE realestate bubble you will have to hold on to a house for 5-7 years to break even. You see the rest of us in the real world not that make believe state of California know how to invest a little more wisely (excluding area's like Detroit that got hit due to unemployment).

Unless you have the money to lose you should not be investing in property for a short term of 2 years. A house should be a long term investment for the average person not a means for quick cash, that my dear is what got us into this rediculous mess in the first place. People looking for a quick buck in an exagerated market and guesse what the last person out the door has to turn the freaking lights off of everything and gets stuck with the bill.....

Do I feel sorry for the people that this happened to yes I do. Do they have a high amount of respnsibility? Hell yes. A lot of them were in it for the quick buck that you mentioned in the post I am quoting. You need realize the bubble was eventually going to burst and when it did people would have to pay......:poke:

[manu1959]

Try reading POST # 60 it did answer yoru question.

To address your concern here about owning a house for only 2 years is absolutely nuts. In MOST of the country where there was not this HUGE realestate bubble you will have to hold on to a house for 5-7 years to break even. You see the rest of us in the real world not that make believe state of California know how to invest a little more wisely (excluding area's like Detroit that got hit due to unemployment).

Unless you have the money to lose you should not be investing in property for a short term of 2 years. A house should be a long term investment for the average person not a means for quick cash, that my dear is what got us into this rediculous mess in the first place. People looking for a quick buck in an exagerated market and guesse what the last person out the door has to turn the freaking lights off of everything and gets stuck with the bill.....

Do I feel sorry for the people that this happened to yes I do. Do they have a high amount of respnsibility? Hell yes. A lot of them were in it for the quick buck that you mentioned in the post I am quoting. You need realize the bubble was eventually going to burst and when it did people would have to pay......:poke:


florida was the other market that went high risk and imploded.......both single and multi-family tanked.....

[diuretic]

They werent tricked. they were stupid. and it's not the people who suffer. its the lenders who wont ever get their money back.

I don't know if they were "stupid.". They might not have realised what they were getting into, true, so that probably makes them ignorant of the situation they were facing. As a test about ignorance, ask yourself, would you have signed up to one of these loans with the conditions explained to you?

The people who created these loans need to bear responsibility - and the regulators who allowed them to continue to exist. Ponzi Schemes are rightly outlawed, but it seems to me that these sub-prime loan systems have had a far more damaging effect on the world's financial industry than any Ponzi Scheme.

[diuretic]

JD,

With lower interest rates more people are leigible to buy thier first home - or people are able to buy their 2nd or vacation home

It is not all the doom and gloom the liberal media would have you believe

The bottom line is, this is another manufactured crisis by the left and they are using it to move in on banks and mortgage companies where they have no authority to do so

Not all doom and gloom? Have you checked lately? In the UK the government had to nationalise Northern Rock. Elsewhere banks are seeing their prices sliding down as the full realisation of this mess sinks in. I sincerely hope you're right but I fear there's more to come.

As for manufactured crisis by the left. That's patently ridiculous. It was created by greed and it's wreaking havoc.

[theHawk]

Report: Subprime probe gets cooperation
Investigation looking at if banks hid information about high-risk loans



updated 10:53 a.m. PT, Sun., Jan. 27, 2008
ALBANY, N.Y. - A company that analyzed the quality of subprime mortgages for investment banks has agreed to provide the New York attorney general with information for an investigation, a newspaper reported Saturday.

The agreement involves Clayton Holdings, of Shelton, Conn., a publicly held company that is a major provider of mortgage due diligence services to investment banks, The New York Times reported. Clayton was provided immunity from civil and criminal prosecution although there was no evidence of its wrongdoing, according to the newspaper.

Clayton has told the prosecutors that starting in 2005 it saw a significant deterioration of lending standards and a parallel jump in lending exceptions. At issue is what information about the quality and risk of the loans was given to the investment banks and what was given to the rating agencies.








http://www.msnbc.msn.com/id/22865876/


But your original article blames the moves done in 2003. It was very specific about it:


OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative.

Your whole point is that this is all Bush's fault. Now you've run out and found a new source. Are you now throwing out your original premise, because that was done by a Clinton appointee?

I smell a political hack...

[Hobbit]

What everyone seems to be forgetting is that many of these poor, pitiful victim borrowers lied about their income so they could get a huge loan while the rates were still low, that the banks are losing arm loads of money by foreclosing $400,000 loans on houses that are now only worth $150,000, not to mention the fees associated with selling it. If any banks lied about or concealed loan conditions, then that constitutes fraud and requires no new legislation. In the end, though, the only true victims are the ones who used common sense, spend less than they made, borrowed no more than they could pay back, and, under the suggestions being given to Congress aren't going to benefit from their good behavior because everybody who was stupid would be bailed out.

[Nukeman]

Florida was the other market that went high risk and imploded.......both single and multi-family tanked.....
OH ya Florida's Pre construction condo market took a big dump about 18 months ago. Condo's that were pre construction for 1-1.5 mill are now available for 750-900 k. Pretty substantial hit. Actually it is akin to the market adjustment the only problem this time around it hit a lot of the "little" guys and not just the rich who were investing.......

[Yurt]

regulating commerce between and among states is not the same as preventing high risk loans from being sold......

exactly. tm doesn't understand that the power is there to secure a more uniform economy. i personally think the power is overused by congress, hell, there is even a "dormant" commerce clause. maybe tm thinks congress should arrest the inventors candy, ice cream, coke, pepsi, trans fat, fried chicken and the blessed deep fried twinkie... because those items have caused america more grief than the subprime loans

[Nukeman]

The biggest problem I see is that it was always a "rule-of-thumb" that you could afford a house that was 3x what your annual income was. This was the ideal/max amount you should pay for a home. This went out the window when you had idiots in California willing to get into bidding wars over a piece of property. This caused a false escalation in housing prices that was impossible to maintain. Now we see the fruits of this debacle and you have people like TM scramming for more government involvement.

I say let the banks take their lumps, let some of the people that over extended themselves take what they deserve and we all learn something from this, and that is DINT TAKE MORE OF A LOAN THAN YOU CAN AFFORD...

[manu1959]

The biggest problem I see is that it was always a "rule-of-thumb" that you could afford a house that was 3x what your annual income was. This was the ideal/max amount you should pay for a home. This went out the window when you had idiots in California willing to get into bidding wars over a piece of property. This caused a false escalation in housing prices that was impossible to maintain. Now we see the fruits of this debacle and you have people like TM scramming for more government involvement.

I say let the banks take their lumps, let some of the people that over extended themselves take what they deserve and we all learn something from this, and that is DINT TAKE MORE OF A LOAN THAN YOU CAN AFFORD...

hey now.....i made good money off those idiots......:lol:

[Yurt]

The biggest problem I see is that it was always a "rule-of-thumb" that you could afford a house that was 3x what your annual income was. This was the ideal/max amount you should pay for a home. This went out the window when you had idiots in California willing to get into bidding wars over a piece of property. This caused a false escalation in housing prices that was impossible to maintain. Now we see the fruits of this debacle and you have people like TM scramming for more government involvement.

I say let the banks take their lumps, let some of the people that over extended themselves take what they deserve and we all learn something from this, and that is DINT TAKE MORE OF A LOAN THAN YOU CAN AFFORD...

i pay $1000 for a one bedroom

just got back from the desert and realized that i would rather pay $1000 for my one bedroom than pay the same for a 3 bedroom house in the desert. tho i do struggle with the house i stayed in, now if i had that house for a grand.....

[diuretic]

What everyone seems to be forgetting is that many of these poor, pitiful victim borrowers lied about their income so they could get a huge loan while the rates were still low, that the banks are losing arm loads of money by foreclosing $400,000 loans on houses that are now only worth $150,000, not to mention the fees associated with selling it. If any banks lied about or concealed loan conditions, then that constitutes fraud and requires no new legislation. In the end, though, the only true victims are the ones who used common sense, spend less than they made, borrowed no more than they could pay back, and, under the suggestions being given to Congress aren't going to benefit from their good behavior because everybody who was stupid would be bailed out.

So the lenders didn't bother to check anything they were told?

[Nukeman]

i pay $1000 for a one bedroom

just got back from the desert and realized that i would rather pay $1000 for my one bedroom than pay the same for a 3 bedroom house in the desert. tho i do struggle with the house i stayed in, now if i had that house for a grand.....
Hell I pay less than that for 5 bedrooms, 3 baths, on 2 akers' with an inground pool. Just have to know where to live for more space:laugh2:

We are in the middle of woods, lakes, and a nice farm across the road.... Not to shabby!!!!

[Nukeman]

So the lenders didn't bother to check anything they were told?
Some don't do a thurouogh check due to the fact they were planning on selling the mortgage the day after closing, so they really were not all that worried about it...