Why Isn't Anyone Mentioning Predatory Lending

[lligrd]

as the root cause of this debacle? It was the 0% introductory interest that rose to rates few could afford that led to the rise in housing prices and the foreclosures. Where are the usury laws?

[TexasObserver]

1. Hey! It's Free Money and Tax Cuts for the top 1%!!

Stay on message, dammit!!

[aquart]

2. Oh, sweetie, because it's such a wee tiny bit of this poison pie.

[JVS]

3. Because TPTB are trying to give these people $700Billion. Mentioning that would be bad PR

[depakid]

4. That's a load of crap

No one's "giving" anyone $700 billion- and of course there need to be regulations and controls on predatory lending and usurious interest rates.

And hopefully, those will be addressed by an Obama administration and a new Democratic Conmgress.

But that's still many months away- and the current situation needs to be addressed NOW.

[lligrd]

6. Why Do We Have To Wait?

We have the upper hand now. Why the hell would we wait to fix what caused the situation? Chit, if your kid spent all his college money on drugs would you give him more money for college before you got him off of drugs?

[depakid]

10. Because Congress is about to recess- and Bush would veto them

Is anyone still doing Alt-A loans?

Regarding credit card rates and fees, that has to be done at the national level, by dealing with the Supreme Court's decision Smiley vs. Citibank, and preempting state laws in places like Delaware and South Dakota.

<on edit- the Marquette decison also needs to be dealt with through legislation>

http://en.wikipedia.org/wiki/Marquette_Nat._Bank_of_Minneapolis_v._First_of_Omaha_Service_Corp.

http://en.wikipedia.org/wiki/Smiley_v._Citibank

[lligrd]

11. Delaware One Of The Worst. Anyone Know Biden's Take On This? nt

[depakid]

12. I don't imagine it's a progressive one. LOL

Though maybe once he's VP -and not a Delaware Senator, that might change.

[lligrd]

13. Betting You Are Right On That nt

[elleng]

5. I think its mentioned, but only sub rosa;

sub-prime mortgage loans are a form of such, and bundling them and 'selling' them near and far are, in fact, a or the major cause of the debacle.

'Usury' laws went out of fashion; hope they're coming back.

[lligrd]

7. Sub-prime Is A Credit Scam In Itself

forcing people to borrow to become credit worthy.

[elleng]

15. No one is 'forced' to borrow,

especially to buy a house, but many were 'lured' into difficult/complex transactions, difficult to understand and difficult to decline; 'scammers' took advantage of human nature, which such types have done forever, I think.

So in the interest of 'society,' govt. must regulate against such kind of 'scams.'

[McCamy Taylor]

20. Minorities were given crap loans though more than 1/2 qualified for good loans. Whites got good loan

The federal government deliberately stopped monitoring the demographic profiles of who was getting what type of loans in a hear no evil see no evil scam so that Blacks (and Latinos) could have the economic prosperity from the Clinton administration stolen from them in an attempt to "put them back in their places".

If you need a house and no one will give you a good loan, you take what you can get and hope things get better with the next administration.

[elleng]

21. Right, so I don't 'blame' borrower,

but rather lender, and govt including fannie and freddie, for not doing oversight.

[TreasonousBastard]

8. Plenty of people are, but...

that's only part of the problem-- if mortgages weren't able to bundled they way they were, predatory lending wouldn't have been so prevalent. You don't lend money to people who can't pay it back when you have to hold the paper or account for it.

Nobody should be let off the hook, though, and a lot more than mortgage brokers made out great while the fun lasted.

[lligrd]

9. I Personally Know People With Good Credit That Fell For The Scams

Arms they can afford (barely) but are unwilling to pay on houses no longer worth what they owe. Predatory lending doesn't only affect the poor.

Edited to add: But it can make those who once weren't, poor.

[dkf]

14. Nobody listens to the "if its too good to be true" rule anymore.

ARGH.

[TreasonousBastard]

23. That's not entirely the point-- yes lots of...

people from all walks of life have been scammed.

But, the problems of ARMs, balloons, and other enticing loan schemes would be reduced if banks actually had to keep their mortgages in house, or sell them at real market value.

[dipsydoodle]

16. That was indeed the basic root

but it was the subsequent bundling and reselling as bonds which did the real damage.

[depakid]

17. Not just the bundling- but the rating

[dipsydoodle]

18. That bit, the rating,

was fraud - defined as deliberate intention to deceive. The preceeding two were not necessarily so.

When fraud charges are finally raised the additional charge of conspiracy to commit fraud will carry heavier penalties.

[elleng]

22. BIG problems with 'rating' agencies.

SEC may do oversight.

[Iterate]

19. ACORN has and they're getting creamed.

[Naturyl]

24. All usury is predatory.

And all lending at interest is usury.