Wells Fargo listed among top subprime loan makers
By NEAL ST. ANTHONY, Star Tribunewww.startribune.com...
Last update: May 6, 2009 - 9:35 PM
Wells Fargo, the nation's largest mortgage company, was the
eighth-largest maker of subprime mortgages in recent years and among the 25 biggest players in the subprime market that imploded in 2007 and 2008, spurring the government to inject hundreds of billions of dollars into U.S. banks, according to a nonprofit research group.
The Center for Public Integrity, using data from lender filings made under the Home Mortgage Disclosure Act, listed among top subprime lenders Countrywide Financial Corp., Ameriquest Mortgage Co., New Century Financial Corp., Wells Fargo, J.P. Morgan Chase, Citigroup and WMC Mortgage Corp., a unit of General Electric. They were among "enablers that bankrolled the type of lending that has threatened the financial system," the center said.
The center reviewed government data on nearly 7.2 million high-interest or subprime loans made from 2005 through 2007, from the peak to the collapse of the subprime boom. The center said the top 25 originators of such loans accounted for nearly $1 trillion of the $1.38 trillion in subprime loans made during that period.
The center, a nonprofit, independent, research and news agency founded in 1990, specializes in investigative reports that affect the public purse.
In a prepared statement Wednesday, Wells Fargo dismissed the research report.
. . .
Wells Fargo DID have a huge subprime lending unit. I remember hearing a lady who was involved in it until she finally got fed up & left.
Wachovia bank went under, in large part because it purchased World Savings [of California] which was writing streams of subprime mortgages that were scandalously rife with every kind of fraud & shenanigans.
Wachovia didn't do the due diligence to see that World Savings was an empty soap bubble waiting to pop, before paying an unwarranted absurdly high price for it.
Wachovia was in all certainty a reasonably sound bank that went under solely for their stupid unknowing purchase of World Savings.
As for all the banks that were bankrolling this stream of sh;t,
They either were knowingly involved or criminally negligent for not knowing or in denial of what they didn't want to know.
Clearly with Wells Fargo it was a subprime fraudulent lender.
One has to wonder how much these banks knew about the 3rd party loan originators. Was that just a means of making it seem like their hands were clean, at least in terms of intent? Plausible deniability?
What went on at 3rd party loan originators was wildly criminal.
Most of the time they bald face lied to borrowers, although in some cases borrowers were prodded into lying on applications by these same 3rd party loan originators.
On a personal note,
if your mortgage agreement(s) is a hundred or more pages it is probably that long because they don't want you to read it.
Especially the rat-trap, surprise clauses that the sales people never told you about. Or that the sales people rationalized away with phrases such as, 'You can just re-finance' or 'You can turn around & sell it'.
You will notice the US government has done NOTHING to curb this kind of consumer abuse.
CYOAF - Cover Your Own [Backside] First
You have to read all contracts, & understand them well before you sign. If there is anything you don't understand ask some independent, non-connected expert, not the sales people who will lie ruthlessly.
A really important note:
Banks WANTED SUBPRIMES, even over prime mortgages,
Why?
Because they paid higher interest.
But they [insanely? crookedly?] neglected to take into account the higher default rates of subprime, which is WHY they pay higher interests.
But banks didn't care, because loony ratings agencies would give triple A ratings [the very highest] to any kind of garbage they bundled together in a 'mortgage security' & they would just unload it on some other sucker.
Subprime mortgages paid higher fees, bonuses & rewards, because of bank preferences.
They were giving subprime mortgages to people completely qualified for a prime mortgage, because they wanted subprimes so badly.
And because no one & i mean NO ONE was watching, these were loaded with impossible terms & completely unsustainably by the people borrowing, even if the economic crash might not have happened.
I am angry at the banks for both knowingly & irresponsibly recklessly sponsoring & even doing these subprime rattrap mortgages.
They engineered & bankrolled it.
I am angry at all the sleazy 3rd party loan originators who took all their dirty bonuses & closed up shop, never to be traced again.
And i am angry that American consumers could be SO stupid & so inattentive in a vicious, dirty American style market system.
And it all scares me, because maybe i won't be paying attention carefully in the future & this or something else equally bad might suck me into it.
Or even if i don't personally get hooked in it, i will have to live with global economic devastation & higher taxes to pay to bailout the very authors of some new mess.
[edit on 17-5-2010 by slank]
