fun financials fact of the day
From Marginal Revolution:
BasePoint Analytics LLC, a recognized fraud analytics and consulting firm, analyzed over 3 million loans originated between 1997 and 2006 (the majority being 2005-2006 vintage), including 16,000 examples of non-performing loans that had evidence of fraudulent misrepresentation in the original applications. Their research found that as much as 70% of early payment default loans contained fraud misrepresentations on the application.
Just . . . wow. Can an entire industry be corrupt?
I don't know how you can blame all this on the borrowers. If they were lying somehow to get a mortgage, then lenders were utterly negligent-perhaps criminally so, in misrepresenting the risk to banks-in not checking them out.
Jesus, what a mess. I hope y'all either rent or have fixed-rate mortgages, in which case I'd hold on to them for dear life.
BasePoint Analytics LLC, a recognized fraud analytics and consulting firm, analyzed over 3 million loans originated between 1997 and 2006 (the majority being 2005-2006 vintage), including 16,000 examples of non-performing loans that had evidence of fraudulent misrepresentation in the original applications. Their research found that as much as 70% of early payment default loans contained fraud misrepresentations on the application.
Just . . . wow. Can an entire industry be corrupt?
I don't know how you can blame all this on the borrowers. If they were lying somehow to get a mortgage, then lenders were utterly negligent-perhaps criminally so, in misrepresenting the risk to banks-in not checking them out.
Jesus, what a mess. I hope y'all either rent or have fixed-rate mortgages, in which case I'd hold on to them for dear life.