Yet even by WaMu’s relaxed standards, one mortgage four years ago raised eyebrows. The borrower was claiming a six-figure income and an unusual profession: mariachi singer.
Mr. Parsons could not verify the singer’s income, so he had him photographed in front of his home dressed in his mariachi outfit. The photo went into a WaMu file. Approved.
“I’d lie if I said every piece of documentation was properly signed and dated,” said Mr. Parsons, speaking through wire-reinforced glass at a California prison near here, where he is serving 16 months for theft after his fourth arrest — all involving drugs.
While Mr. Parsons, whose incarceration is not related to his work for WaMu, oversaw a team screening mortgage applications, he was snorting methamphetamine daily, he said.
No wonder Republicans were always screaming about sex offenders. It diverted attention from the tweekers running amok in the house building, financing and selling industry. At least in the 1980’s it was just cocaine.
Just don’t let this make you lose your faith in the flawlessness of our free market system.
Behold, the market works in mysterious ways. No regulations are needed.
oh yeah republicans, thats why the king of giving mortgages to people who couldnt afford them was barney frank.
So how did Congressman Frank impose his will on a Republican President with Republican majorities in the House and Senate?
And then tell me it’s CLinton;s fault.
GOP Pervert # … Uh, What Number Are We Up To?
Bet you didn’t know convicted pervert Mary Kay LeTourneau is the daughter of a pair of rightwing screwballs, did you? I didn’t until I stumbled onto this info by accident.
Her father was John G. Schmitz, an anti-semitic GOP congressman from Orange County, California, who was so far right he got kicked out of the John Birch Society for extremism. Schmitz admired Joe McCarthy so much he bought the late senator’s home and sold McCarthy memorabilia. His wife was a rightwing commentator and anti-feminist activist.
Apart from advocating a Pinochet-style military coup in the U.S. and being successfully sued for defamation by feminist lawyer Gloria Allred for defamation, whom he called a “butch lawyeress,” Schmitz was famous for a notorious incident involving one of his bastard children from an extra-martial affair. According to Wikipedia,
“Early in 1982, John George Stuckle, an infant …, was treated at an Orange County hospital for an injured penis. A piece of hair was wrapped so tightly around the organ ‘in a square knot,’ according to one doctor — that it was almost severed. …
“[T]he baby’s mother, Carla, a 43-year-old Swedish-born immigrant and longtime Republican volunteer, wasn’t allowed to take John George home, since some of the attending doctors were convinced the hair had been deliberately tied around his penis. Detectives threatened to arrest Carla and take John George away permanently unless she identified the father.
“In a shocking development, Carla said that Schmitz was John George’s father. During a custody hearing, Schmitz acknowledged fathering John George out of wedlock. He’d also fathered Carla’s daughter, Eugenie. The admission effectively ended his political career.”
(Quoted under fair use.)
So, in case you were wondering what kind of influences LeTourneau grew up under, well, now you know …
Um … is it asking too much that mortgage processors, brokers, and wholesalers be licensed? You know, like barbers and cosmetologists and real estate agents? So the state can revoke their license if they’re snorting meth on the job?
Again, we all know the GOP fucked up the mortgage industry and was responsible for the housing crash. How do we know? On Nov 4 we got together and held this little thing called a vote. The results thereof led to the complete and utter destruction of the liars and idiots in the GOP. The public had a chance to decide who to blame. They intelligently and correctly blamed the fools in the GOP. And DEMOCRATS WON!
So the lies from the cowards on the right weren’t persuasive then and are even less so now.
You see, nobody cares what the GOP thinks. Why? Because we shamed them. We bitch-slapped the whole lot of them.
America spoke. The GOP is to blame. Long live Democrats. Now righties, grab your ankles bitches and assume your rightful position.
@6 Mrs. Rabbit just asked me if criminal behavior causes rightwing extremism and I told her, “I think it’s the other way around.”
Greed is not good, Greed is evil.
Now if I could just figure out what the bumper sticker opposite of “Greed is good” would be, cause “Live ethnically and honorably” just doesn’t have the same effect.
This is what happens when you loan money to Mexicans!
@9 No, this is what happens when you vote Republican, you racist pig!
You can’t loan money to people who can’t pay it back, no matter what the government is encouraging you to do.
Also, like Ron White says, “You can’t fix stupid.” People should accept personal responsibility for getting themselves into mortgages they couldn’t afford.
@11, Stupidity is lending money to someone who won’t pay you back. The only reason lenders overlooked this cardinal rule of stupidity is because they knew they were going to sell the mortgages to chop shops 20 minutes after the ink dried, wiping their hands of responsibility. Chop shops (CDO’s SIV’s, etc) evolved (or devolved?) from another cardinal rule; humans are greedy fucks. Greed has to be regulated because humans can’t control themselves.
11 “You can’t loan money to people who can’t pay it back”
Then, what the fuck is Hank Paulson doing?
Your whole line of reasoning is a load of fetid manure, Einstein. When you put your money in a bank, you’re putting your trust in the people who work at the bank not to do something dumb with it. The loan departments of banks are (or at least, were) supposed to appraise the properties to be mortgaged and vet the loan applicants. They haven’t been doing either. Of course, the banks haven’t really been taking care of your money for a long time, either.
This is like if you were to go to a hospital and they let a hog butcher take out your appendix.
4 Roger, I had my memory jogged the other day about another Republican pervert. In 2004, Jack Ryan, GOP primary winner for a certain Senate seat from Illinois, was forced to open the records from his recent divorce. This revealed a rather sordid account by his now-ex wife Jeri (yes, the actress) about his affinity for sex clubs and his constant pressure for her to participate all sorts of kinky things.
This, of course, led to the sudden end of his political career. The Republicans nominated Alan Keys instead, whose wingnut ravings prompted 70% of the voters to cast their ballots for Barack Hussein Obama.
The rest, as they say, is history.
Anyone hear the latest about Chris Dodd? Seems he got a no-doc loan on a house in Ireland. He must have known it was illegal as all get out, because he sold the property shortly after his sweetheart loan from Countrywide was made public.
Is it possible he hasn’t released the the loan documents, as he promised to do last summer, and continues to promise, because it would have led to this even bigger transgression?
This is the guy who is in charge of banking committee in the Senate. Could be a scandal, but I doubt it, because he is a democrat. We all know they don’t do anything wrong, and had nothing to do with filibustering new regulations on Fannie and Freddie. And they were taking all sorts of donations from those two fine examples of integrity. I’m sure there is nothing to it all.
But don’t let this get in the way of a really fascinating story about some teacher from 20 years ago.
@15: Cite, please. I Googled “Chris Dodd home Ireland”, and could only find similar rumors on winger sites, but no real news story from any legitimate source.
16 This may be another example of either the Great Conspiracy of the entire press outside of Fox News and the Washington Times, or that reality has a distinctly liberal bias.
Tell me, Janet….while you’re oh-so-concerned about one guy’s house, are you at all concerned about what’s happened to the trillion or so dollars that the US Treasury and the Federal Reserve have handed over to the banks in the last six months? Or are you too busy sitting in a dark corner repeating the Cheneyesque mantra, “Deficits don’t matter, deficits don’t matter…”?
About ten years ago, our daughter managed the Tully’s Coffee store at the north end of the Westlake Center, off the lobby for the office tower. She used to tell us she often felt like a drug pusher, because she’d see the same finance guys and corporate lawyers in their Armani suits come dashing in from the elevator a half dozen or more times a day for a triple-shot latte. Apparently, as time passed, and the deals got sketchier, and the pressure to make it all happen got greater, some felt they had to resort to something stronger than caffiene to keep up.
That Chris Dodd got preferential treatment from a huge mortgage company who had business before his committee is not in question. That’s called being on the take.
What is in question is why he isn’t coming clean with the documents, as he himself promised he would do. If it is all above board, and he received the same rates as everyone else, why not just put it all out there?
The house in Ireland just makes it all a little more understandable.
Right wingers tend to turn on their own, and get them out of town. Left wingers just defend their rotten colleagues, and hope it all just blows over.
Shouldn’t you all be calling for the resignations of scum like Chris Dodd and Charles Rangel? Why no calls for the resignation of WIlliam Jefferson? Seems like you just like to leave them where they are, and hope everyone just moves on.
Were you questioning whether he owns a house in Ireland, or that he got a no-doc loan for it?
http://www.washingtonpost.com/.....000388.pdf
Looks like Killinger and his wife are Democrats, based on political contributions. He gave money to McGavick, as well, but that might have just been a friendship thing, who knows.
I personally think the guy should be indicted for fraud, and if convicted, forced to give up his ill-gotten loot and sit in jail for a long time.
But now that I’ve pointed out that the Chairman of WAMU is a democrat, I’m betting all of you will be falling all over yourselves to make excuses for him, and let him off the hook.
Because, you know, only Republicans are corrupt.
@10
@9 No, this is what happens when you vote Republican, you racist pig!
if there is no god, what power determines that racism is bad?
Good catch Janet. Figgers a libtard couldn’t find it.
Whether or not Killinger may be registered as a Democrat, he certainly seems to have had no reservations whatever about taking full advantage of the neocon corporate socialists’ upside-down bizarro world of finance and business ethics, in which the executives responsible for the greatest failures receive the most lavish personal rewards.
Then again, perhaps WaMu was allowed to collapse and be gobbled up by another institution, instead of being bailed out by Uncle Sam, because its CEO was a Democrat, or because it was headquartered in a “blue state”.
There’s been a bit of speculation in the past about this sort of thing, including why AIG got rescued while Lehman wasn’t…some of it by the HA right-wingers.
I stand by what I said: if one borrows money for a home he or she can’t afford, then the upcoming foreclosure is his or her fault. It doesn’t matter what the loan originator does with the loan – sells it, keeps it, bundles it up and sells the package to pension funds – the original responsibility lies with the individual who took out the loan he or she could not afford.
What part of “personal responsibility” do you not understand?
Lehman wasn’t rescued because Paulson used to work for Goldman Sachs, Lehman’s arch-enemy, and Paulson saw this as an opportunity to eliminate a competitor. Paulson’s want to resume his career after he leaves office. That’s why Goldman Sachs is still around and Lehman is fading into history.
26 OK, so how come it used to be that when you went to a bank to apply for a mortgage, they made you jump through all sorts of hoops and tell them about your finances and such, and if the information you provided didn’t meet muster, most likely you wouldn’t get it…but in the last few years they’d loan half a million dollars or more to anybody with a pulse?
Is this supposed to somehow be better?
Granted, when someone is allowed to take out a mortgage, it says right there in black and white that it’s the mortgagee’s responsibility to pay…but does it make sense for a financial institution issue mortgages to thousands of borrowers that aren’t likely to be able to pay off, unless they’re able to “flip” the property within a year or two?
If that’s what a borrower is expected to do, why do the terms of the mortgage define terms of payment over decades? You’re stretching the bounds of reason if you say there isn’t some kind of disconnect here.
The answer, of course, is that the institution issuing the mortgage didn’t give a rat’s ass whether the borrower could pay it off, because it simply aggregated all those flaky mortgages before the ink was dry on the signatures, and sold them to someone else. “Loan officers” were reduced to mere sales agents.
PI @ 26 said:
So what are you proposing?
Assuming that we let those homes go into foreclosure (as most of them already are), and the empty foreclosures then drive down real estate prices (as much as 50% in some areas of So. California, Nevada, and Arizona), what about the borrowers who acted prudently? What about those who purchased their houses with mortgages they could afford, and a 20%+ down payment, except that now their home is now “under water” due to the other foreclosures? They are okay if they can sit tight and ride it out, perhaps, but what if they can’t sell if when they need to for completely unrelated reasons (health problems, death in family, job change, divorce, etc.). Now those homes go into foreclosure too, yet driving down the prices even more, and causing yet more homes to go into foreclosure, in a dismal tailspin?
Then the banks who gave out the unsafe mortgages fail first, but the secondary mortgage failures and resulting foreclosures caused by rapidly falling real estate prices start to drag down otherwise prudent and safe banks along with them.
Okay, that’s the current situation. Now here is what happens next, if the emergency steps aren’t taken to reverse the situation:
The FDIC struggles to find healthy banks to take over the failing ones, but soon finds that there aren’t enough healthy banks left to handle the ever-worsening situation. Banks start to fail and doors are closed, with the FDIC promising to make good depositors up to the limits of it’s guarantee “within 60 or 90 days”. This causes a run on the remaining banks, as bank customers try to get their cash out before their doors are closed, too. Even more supposedly “solvent” banks find themselves crushed by the run on their deposits, and are forced to close their doors, also. The bill to the taxpayer, in FDIC guarantees, soon hits a trillion dollars, and then doubles, and then triples that amount.
The bank closures ripple through every sector of the economy. Customers who couldn’t get their money out in time can’t pay their bills – including mortgage payments, some to banks which had somehow managed to remain open until this point, but are finding a lot of their customers who had been great credit risks are now in default due to their cash being tied up in another bank’s failures. Businesses close their doors as their working capital is frozen, and they can’t make payroll. Mass layoffs start to hit every corner of the economy. State and Local governments find their tax receipts plunging, rendering them unable to provide basic services, and even unemployment insurance is cut back severely just at the time it is needed most.
Thus historians will right about the “Second Great Depression”, which started in 2008 due to lax regulation of the mortgage business, and became much worse because nothing was done due to wingnuts who argued that it was “all the fault of the borrowers who took out mortgages they couldn’t afford”, and that “they deserved to loose their homes, and there was no need for the government to interfere with that process.”
“Now if I could just figure out what the bumper sticker opposite of ‘Greed is good’ would be, cause ‘Live ethnically and honorably’ just doesn’t have the same effect.”
i take it you mean ethically, not ethnically. unless i am missing something here.
i used to like those VISUALIZE WORLD PEACE stickers. they were usually mounted on the back bumper of the car, right above the tailpipe.
@28 – It’s called the Community Re-Investment Act, CRA for short.
@29 – I propose to let those who got loans they couldn’t afford to lose their homes if they can’t make the payments. The only other choice is for the taxpayers to pick up the tab and simply buy those homes and give them to the peole took-out loans they couldn’t afford.
If you thought loan officers were anything but sales people, then you don’t know much about banking and lending. Remember that the first driver of cash flow for any business is sales (or revenues, if you prefer), and cash flow is the life-blood of any business. If a business can’t make a positive cash flow at the operational level, then it will eventually fail.
Loan officers are what garner the most revenues for banks. The banks realized that, in complying with the CRA, they were loaning money to people who couldn’t afford to buy homes, but the customers weren’t complaining: they were too dumb to realize they couldn’t afford to pay the loan payments. The banks packaged those loans and sold then to insurance companies and pension funds because the banking system didn’t want that crap any more than anyone else did.
PI @ 31: Are you still peddling that CRA B.S.? The Community Reinvestment Act has been around since the Carter administration, and merely outlawed “red-lining” and required banks to offer loans in minoritiy neighborhoods to the same extent they did in white neighborhoods. The underwriting standards were not relaxed, in many ways they were more stringent because the banks thought they could make more money by writing other loans, and were looking for reasons to dissaprove CRA loans.
In fact, the CRA loans were a rather small fraction of total lending during this decade, because the “new” products (i.e., sub-prime loans) required much less stringent underwriting and much more profit for the mortgage brokers and banks. Even with the current collapse, the CRA loans aren’t going into default at any greater a rate than traditional loans, and at a lower rate than the sub-prime loans.
And as for your response to my essay @ #29, you apparantly have chosen the “Second Great Depression” option. Congragulations. By choosing ideological purity over practicality, and embracing the “blame the little guy” approach without regard to the consequences, you have adopted the same policy as did George W. Bush & the Treasury Dept. in the spring/summer of 2007, and which they continued to embrace until the stock market crash in Sept. 2008 slapped them in the face. At least they (belatedly) recognized the problem, even if it was too late to avoid a major economic collapse. But at least they are awake to the problem now, wheras you, having had plenty of opportunity to avail yourself of the facts, continue to choose the “Second Great Depression” as an acceptable price for your form of economic ideological purity.
Oh, and by the way, you also fail Economics 101, for not recognizing the difference between Micro Economics and Macro Economics.
Meanwhile, if we need some distraction from all the financial gloom and doom, we have the Israelis bombing the shit out of the Gaza Strip, preparing an armored ground invasion to slaughter anything left moving; India and Pakistan rushing troops to their mutual border and making all sorts of threats in the wake of the terrorist attacks in Mumbai; the president of Somalia finally gave up and headed for the hills; lots of itchy trigger fingers all over the Middle East….anyone want to place their bets on how many new wars are going to be in progress by the time January 20 rolls around?
22 At least we can give PI credit for hitting the nail square on the head in #27.
Gotta love the fact the Seattle Times had to re-print the New York Times investigative WAMU piece on their front page….
How embarrassing.
So, no comments about Chris Dodd and his corrupt actions, or Kerry Killinger and his pilfering or Charlie Rangel and his problems with the US tax code?
Crickets chirping . . .