#OWS Signs

[flacaltenn]

Ok, I made it to page 3 and that's it, so I apologize if this has been covered.

You guys, at least 10-12 of you, are utterly missing the point.

Whether or not it's the home buyers were practicing sufficient personal responsibility is utterly irrelevant. The institutions made the loans, dumped them on other institutions to clean their books, and proceeded to make more loans. Onward and upward it went under the guise of ever-rising housing prices; lo and behold, it reached critical mass and the whole thing exploded.

Aaaaand of course the rest is history. The taxpayer got stuck with the bill - Or in this case, the descendants of the taxpayer.

The big part of the outrage is how the banks and "Investment institutions" seemed to get off scott free.

You're right -- the protest sign was NOT about the lender-lendee relationship. It was about how mortgages were bundled and resold on the market. SUPPOSEDLY to sophisticated investors who demanded MORE of this stuff. The bundling generally was like making sausage. Essentially hiding the worse mortgages like bone, lips and tripe in sausage.

Actually -- Fannie Mae had invented a "RISK TRANSFORMATION FACILITY" that was an entire group dedicated to playing "hide the junk".

http://www.econ.tcu.edu/quinn/crisis/bubble/Fannie Subprime.pdf

Buying Alt-A and subprime mortgages was part of Fannie Mae's effort to meet the challenge. Fannie Mae sought to reap the rewards and protect itself from the downside of the investments through a feat of financial engineering it called its "Risk Transformation Facility," which was meant to transfer the riskiest elements to other investors."We engaged in the subprime market, for the first time closing deals to guarantee and securitize subprime loans, with help from the new facility that allows us to sell off the riskiest layers," Mudd wrote. By October, the company had signed $3 billion of such deals.
Although the deals discussed in Mudd's memos were small in relation to the overall scale of Fannie Mae's business, they reflected the company's appetite for subprime and Alt-A mortgages. The company had a long and deep involvement in this market through a different form of investment.

Now the deal is that banks PREFERRED to write Conforming Loans. The kind that Fannie could buy and rebundle. And contrary to the assertion of one poster -- SubPrimes COULD BE CONFORMING loans due to generous Federal policy. So MOST of the garbage that was rebundled by Fannie or Wall Street LOOKED to be good. And the word was that the GOVT would ALWAYS buy them. So it's no wonder that it was easy to misrepresent what toxic crap might be contained in an MBS...

Another thing that people tend to over look is the fact that pretty much all of the banks creating and selling these securities were also heavily invested in them. That's why it was such a catastrophe when the economy and housing market started to go south. None of the banks knew which banks would or would not get caught holding the shitty end of the stick. So if the sign that lady is holding is accurate, the banks would have been intentionally defrauding themselves. There are a shit ton of dumb MBAs out there, but no one is that fucking stupid.

You know that famous disclaimer. "please read the entire prospectus before investing in this fund". You're right. Fanny/Freddie was buying EXTERNAL (already bundled) MBSs just to "enhance" the market for these sausages. LOADS of sophisticated people were embarrassed to find out what they had bought.

But the deal is -- Because of the dilution of the crap mortgages, the "nuclear" meltdown never occurred. The risk got spread out so that the MBS still had some substantial worth. Which is why TARP was never really used to soak up all that crap..

 

[McDowell's]

Aside from a few idiots wrongly saying this is apples and oranges, nobody has answered my question.

We rely on professionals for their expertise, whether it's a doctor, lawyer, contractor, plumber, financial planner, accountant, or mortgage lender.

There is not a fiduciary relationship between you and the lending agent. So it is apples and oranges.

You have a fiduciary relationship with your plumber? And why is that your yardstick? It's immaterial.

You go to a professional to guide you in areas where you have no expertise. They, in turn, have a responsibility to not mislead you, or lie by omission.

I was responding to your request for someone to give you a logical answer to your initial question. I did, you don't like it. The fact remains that the lending agent is the agent for the lending institution - NOT YOU. Do they have a duty to be truthful? Yes. Do they have a duty to tell you what is or is not in your best interest as opposed to theirs or that of their employer? No. Like you have already proven to everyone but yourself, if you want expert financial advice when considering a mortgage agreement you should hire an expert to advise you. By engaging in a financial transaction with someone elses agent, you are not hiring that person to be your agent. Their primary responsibility is to someone else.

 

[Meister]

There is not a fiduciary relationship between you and the lending agent. So it is apples and oranges.

You have a fiduciary relationship with your plumber? And why is that your yardstick? It's immaterial.

You go to a professional to guide you in areas where you have no expertise. They, in turn, have a responsibility to not mislead you, or lie by omission.

I was responding to your request for someone to give you a logical answer to your initial question. I did, you don't like it. The fact remains that the lending agent is the agent for the lending institution - NOT YOU. Do they have a duty to be truthful? Yes. Do they have a duty to tell you what is or is not in your best interest as opposed to theirs or that of their employer? No. Like you have already proven to everyone but yourself, if you want expert financial advice when considering a mortgage agreement you should hire an expert to advise you. By engaging in a financial transaction with someone elses agent, you are not hiring that person to be your agent. Their primary responsibility is to someone else.

Well stated.

 

[Mustang]

There is not a fiduciary relationship between you and the lending agent. So it is apples and oranges.

You have a fiduciary relationship with your plumber? And why is that your yardstick? It's immaterial.

You go to a professional to guide you in areas where you have no expertise. They, in turn, have a responsibility to not mislead you, or lie by omission.

I was responding to your request for someone to give you a logical answer to your initial question. I did, you don't like it. The fact remains that the lending agent is the agent for the lending institution - NOT YOU. Do they have a duty to be truthful? Yes. Do they have a duty to tell you what is or is not in your best interest as opposed to theirs or that of their employer? No. Like you have already proven to everyone but yourself, if you want expert financial advice when considering a mortgage agreement you should hire an expert to advise you. By engaging in a financial transaction with someone elses agent, you are not hiring that person to be your agent. Their primary responsibility is to someone else.

Are you familiar with the Truth in Lending Act?

Subpart E contains special rules for mortgage transactions. Section 226.32 requires certain disclosures and provides limitations for loans that have rates and fees above specified amounts. Section 226.33 requires disclosures, including the total annual loan cost rate, for reverse mortgage transactions. Section 226.34 prohibits specific acts and practices in connection with mortgage transactions.

Truth in Lending Act - Wikipedia, the free encyclopedia

 

[McDowell's]

You have a fiduciary relationship with your plumber? And why is that your yardstick? It's immaterial.

You go to a professional to guide you in areas where you have no expertise. They, in turn, have a responsibility to not mislead you, or lie by omission.

I was responding to your request for someone to give you a logical answer to your initial question. I did, you don't like it. The fact remains that the lending agent is the agent for the lending institution - NOT YOU. Do they have a duty to be truthful? Yes. Do they have a duty to tell you what is or is not in your best interest as opposed to theirs or that of their employer? No. Like you have already proven to everyone but yourself, if you want expert financial advice when considering a mortgage agreement you should hire an expert to advise you. By engaging in a financial transaction with someone elses agent, you are not hiring that person to be your agent. Their primary responsibility is to someone else.

Are you familiar with the Truth in Lending Act?

Subpart E contains special rules for mortgage transactions. Section 226.32 requires certain disclosures and provides limitations for loans that have rates and fees above specified amounts. Section 226.33 requires disclosures, including the total annual loan cost rate, for reverse mortgage transactions. Section 226.34 prohibits specific acts and practices in connection with mortgage transactions.

Truth in Lending Act - Wikipedia, the free encyclopedia

Are you aware that contradicts nothing in my post?

 

[Synthaholic]

There is not a fiduciary relationship between you and the lending agent. So it is apples and oranges.

You have a fiduciary relationship with your plumber? And why is that your yardstick? It's immaterial.

You go to a professional to guide you in areas where you have no expertise. They, in turn, have a responsibility to not mislead you, or lie by omission.

I was responding to your request for someone to give you a logical answer to your initial question. I did, you don't like it. The fact remains that the lending agent is the agent for the lending institution - NOT YOU. Do they have a duty to be truthful? Yes. Do they have a duty to tell you what is or is not in your best interest as opposed to theirs or that of their employer? No. Like you have already proven to everyone but yourself, if you want expert financial advice when considering a mortgage agreement you should hire an expert to advise you. By engaging in a financial transaction with someone elses agent, you are not hiring that person to be your agent. Their primary responsibility is to someone else.

if I buy a house and I don't use a real estate agent but the person am buying from does use a real estate agent, that real estate agent still has an obligation to tell me everything that is relevant to the transaction. If they know something negative about the house and fail to disclose it, they can lose their license even though they're not working for me. And I'm not talking about something that would fall under the home inspectors area.

 

[Sunni Man]

It is raining cats and dogs in the city that I live in.

I wonder how many OWS "Flea Party" protesters are still down on the Plaza.??

 

[McDowell's]

You have a fiduciary relationship with your plumber? And why is that your yardstick? It's immaterial.

You go to a professional to guide you in areas where you have no expertise. They, in turn, have a responsibility to not mislead you, or lie by omission.

I was responding to your request for someone to give you a logical answer to your initial question. I did, you don't like it. The fact remains that the lending agent is the agent for the lending institution - NOT YOU. Do they have a duty to be truthful? Yes. Do they have a duty to tell you what is or is not in your best interest as opposed to theirs or that of their employer? No. Like you have already proven to everyone but yourself, if you want expert financial advice when considering a mortgage agreement you should hire an expert to advise you. By engaging in a financial transaction with someone elses agent, you are not hiring that person to be your agent. Their primary responsibility is to someone else.

if I buy a house and I don't use a real estate agent but the person am buying from does use a real estate agent, that real estate agent still has an obligation to tell me everything that is relevant to the transaction. If they know something negative about the house and fail to disclose it, they can lose their license even though they're not working for me. And I'm not talking about something that would fall under the home inspectors area.

And they have zero obligation to negotiate the best deal possible with the seller on your behalf. Again, having the basic duty of being truthful in factual representation is not the same as being obligated to pursue your interests. The seller's agent has no obligation to come to you and say "I know you think this deal is good, but they'll take 5000 less if you play hardball." In fact, they would be breaching their fiduciary relationship with the seller if they did that.

 

[Texanmike]

Who's fault is it those people are STUPID.

Here's a clue, you can't afford something, DON'T GO OUT AND BUY IT.

what a concept eh?

It's incumbent upon the lender to determine if an applicant is qualified for a loan.

This is a joke.

It is not the lender's job to determine if an applicant is qualified for a loan. EVERYONE is qualified for a loan. It is on the lender to determine the risk he is taking and how much interest is necessary to make money on the loan. This is a simplified example but it illustrates what happens:

You determine that for people in a similar situation "A" based on past history there is a 3% chance someone will default on their loan. In order to make money on the loan you must charge 3% + enough to make money.

You determine that in a simliar situation "B" based on past history there is a 15% chance that that someone will default on their loan. In order to make money on the loan you must charge 15% + enough to make money.

Of course you redue that 3 and 15% based on the prospective value of collateral, down payment and you likely have some sort of insurance. You will loan money to anyone you can make money off of. That is how it works.

It is on the person accepting the terms of the loan to determine if the terms are acceptable.

It is fucking asinine that people think that someone should be telling a grown adult how much they can afford. Imagine if you were denied a loan and they came out and said "We don't think you can afford this". You make loans based on credit worthiness, not the ability to pay for the loan.

Mike

 

[Lovebears65]

Or

"The loan officer should have done his homework and checked my situation more carefully and found that I really couldn't afford the property based on my income and other obligations and turned me down."

Lol it wasn't because loan officers didn't do homework, its because government involvement cause decline in lending standards, and because people didn't learn what a variable rate is before they bought houses....it wasn't country wide's responsibility to explain how your interest rates can go up.

It sure as hell is.

So, when is it the buyers fault. They went out and bought the damn house. They should know how much monthly payments they can afford. The bank doesnt know that you go out to eat every night or your a shopaholic . On paper it says your have enough funds. The people who gives out mortgage wants to make money, its their job , their lively hood. They know on paper you make enough money. Why do they have to treat people like they are 2 years old and ask well do you have a shopping problem or do you go out to eat every night because if you do , you wont have enough funds to make your mortgage payments. Its just stupid . People need to take responsibility into their own lives and quit blaming everyone else. The left loves to put blame on everyone except for looking the person in the mirror

 

[daveman]

Who's fault is it those people are STUPID.

Here's a clue, you can't afford something, DON'T GO OUT AND BUY IT.

what a concept eh?

It's incumbent upon the lender to determine if an applicant is qualified for a loan.

Nobody forced people to sign for loans they couldn't afford.

 

[daveman]

It's incumbent upon the lender to determine if an applicant is qualified for a loan.

Ultimately, it is your responsibility to determine what you are capable of purchasing. Stop passing responsibility for your decisions off on other people.

If a person lacks enough common sense to know what he can or cannot afford, it's up to the lender to set him straight.

Afterall, it's the lender who is ultimately on the hook for the money.

You leftists sure do hate the concept of personal responsibility, don't you?

 

[daveman]

It's incumbent upon the lender to determine if an applicant is qualified for a loan.

Ultimately, it is your responsibility to determine what you are capable of purchasing. Stop passing responsibility for your decisions off on other people.

So if a doctor tells you you are fine, then you find out that he should have seen your cancer, it's your fault?

Are you saying people don't have the intelligence to determine if they can afford a certain payment each month?

 

[daveman]

Too be fair, most people never learned critical thinking skills so can only trot out tired, knee-jerk sayings.

Indeed.

 

[Lovebears65]

Ok, Here is a example for you

I want a house that is on the top of my budget and on paper I have enough funds and enough to make the monthly payments and down payment but I spend money like its water and a shopaholic ,Is it my fault or the banks fault that I want that house or is it mine. The left would say its the banks because the lender did not check out my spending habits. I say its mine because i should know my spending habits and know that I could not pay the mortgage payments and still shop the way I do

 

[daveman]

Did everyone miss the point of this woman's sign?

The point was not that they sold mortgages to people who couldn't afford them?

It was that they took these mortgages, and sold them to other institutions!

We all deserve some of the blame for the housing bubble. The banks, the people who bought larger houses than they needed with the hope of flipping them at a profit in five years, the TV shows that told people that "house-flipping" was a get-rich quick scheme.

And if people hadn't signed mortgages they couldn't afford, what would have happened?

There wouldn't have been a pile of bad mortgages to sell, would there?

 

[Synthaholic]

I was responding to your request for someone to give you a logical answer to your initial question. I did, you don't like it. The fact remains that the lending agent is the agent for the lending institution - NOT YOU. Do they have a duty to be truthful? Yes. Do they have a duty to tell you what is or is not in your best interest as opposed to theirs or that of their employer? No. Like you have already proven to everyone but yourself, if you want expert financial advice when considering a mortgage agreement you should hire an expert to advise you. By engaging in a financial transaction with someone elses agent, you are not hiring that person to be your agent. Their primary responsibility is to someone else.

if I buy a house and I don't use a real estate agent but the person am buying from does use a real estate agent, that real estate agent still has an obligation to tell me everything that is relevant to the transaction. If they know something negative about the house and fail to disclose it, they can lose their license even though they're not working for me. And I'm not talking about something that would fall under the home inspectors area.

And they have zero obligation to negotiate the best deal possible with the seller on your behalf. Again, having the basic duty of being truthful in factual representation is not the same as being obligated to pursue your interests. The seller's agent has no obligation to come to you and say "I know you think this deal is good, but they'll take 5000 less if you play hardball." In fact, they would be breaching their fiduciary relationship with the seller if they did that.

But getting the best deal is not and was never the issue with these mortgages. It's a disclosure issue.

 

[Synthaholic]

Ultimately, it is your responsibility to determine what you are capable of purchasing. Stop passing responsibility for your decisions off on other people.

So if a doctor tells you you are fine, then you find out that he should have seen your cancer, it's your fault?

Are you saying people don't have the intelligence to determine if they can afford a certain payment each month?

Certainly some people don't.

 

[Full-Auto]

If I give a homeless man a dollar, I'm a Conservative. If I make him dance for it, I'm a job-creator."
If I make someone else give him the dollar Im a liberal.

 

[Dragon]

And if people hadn't signed mortgages they couldn't afford, what would have happened?

There wouldn't have been a pile of bad mortgages to sell, would there?

True. However, and rather more to the point, if piles of mortgage-backed securities hadn't been sold, and people HAD signed mortgages that failed, the impact on the economy would have been minimal.

It's clear what actually caused the melt-down.