Emit I am in the mortgage business and I am glad you posted that

What is currently happening in the mtg business is truly unbelieveable. Brokers and appraisers are being blamed for the policies the clinton administration put in place due to lobbyist pressures . Minority homeownership was the lead motto. It is great for anyone minority or not to own a home however due to this policy minorities( who did not qualify for loans ) were given loans at 107% meaning they could buy a home and finance the closing costs and come to the closing table with zero dollars . and these people had terrible credit.

Here is a wake up call if they had poor credit 500-600 and werent paying their bills prior to the home purchase ( they werent hence the low credit scores) what made anyone think they would pay for the mortgage. Now those same people who lobbied for homeownership( even to those who didnt qualify) are now lobbying for forgiving of those loans , free modifications to lower rates and not foreclosing on the loans . Those same people who lobbied have taken zero responsibility for the problem they helped create

One correction if the homes were in a cra area ( low to moderate income census tract) the borrowers were in fact eligible for lower rates than those of conventional loans

Type your own address in on this site and it will tell you what the income census tract is

The government is at fault for succumbing to the lobbyist as they wanted to secure those votes . Anything for votes . The banks are responsible for making available 100% financing product to those with 500 credit scores . While some brokers were fraudulant in their practices not all were and not all should be punished which is whats happening. The government has even placed blame on appraisers and the fact is every bank has its own appraisal review department and if the appraisal didnt smell right it got rejected .

How can banks blame brokers and appraisers when the bank underwrites and verifies all in the loan package and also reviewed the appraisals with fine tooth combs. The system is corrupt and whomever has the $ to hire lobbyists gets their voices heard and that is unfortunately the way it is .