This Former marine should be jailed for mortgage fraud

I saw this piece on CNN over the weekend and steam is still coming out of my ears.

I cannot find the full interview on-line but this summary is pretty good. There are a few facts in the longer interview that aren’t in the link. In short, this guy lost his job and in 2005 applied for a refi on his home which he had purchased for $200K in the late nineties.

On his loan application, WHICH HE SGNED, his income was listed as over $13,000.00 a month. In actuality, he had made less than $8000.00 in the past YEAR. The loan papers also clearly showed a monthly payment of over $2700.00. He was approved for a 347K loan

When asked about why he signed the papers, he claims that he was confused, in the longer interviews he also refers to signing the fraudulent papers because he was “desperate”.

One must assume at closing that he walked away with at least $150,000.00 after his old mortgage was paid off. He “doesn’t recall” what he did with the money beyond “pay bills”. The one he most certainly did not do with the money is make a payment on his new loan. That is right, he never made even one mortgage payment after he took the money. He has avoided foreclosure by a variety of ruses, filing for personal bankruptcy several times (not sure how that works but that is what he said in the interview)

Now this obtuse fuckhead actually called CNN because JP Morgan Chase, who now owns this loan, is refusing to work with him to modify the mortgage. Oh Boo fucking Hoo, they want you to actually make a mortgage payment or two before they’ll talk to you even though you keep telling them ( they actually showed a clip of the douchebag on the phone with Chase) that you “ain’t got no money”.

Now even CNN seems to think that he doesn’t deserve help. I’ll take it one further…this gaping felonious asshole should be sitting in a jail cell right now. I mean, he might as well have gone into the JP Chase branch with a gun and held them up, although he probably wouldn’t have gotten nearly as much money.

This is FRAUD, plain and simple,-- and theft by deception— and I’m indignent that he is walking around a free man.

So you’re saying he should be locked up for defrauding the poor, innocent bank who gave him the money, without doing any sort of due diligence, and who got a security interest out of the bargain?

Okay.

Perhaps you could quote the section where he said “without due process”?

No matter how you feel about the victim, he still stole about $150K.

Here’s the video…

How do you figure he stole anything? The lender could have easily verified the income he was reporting by asking for his tax returns and some current pay stubs. It’s the lender’s fault for being so stupid. That’s what happens in business. If you don’t do your due diligence you get burned. I’m supposed to feel bad for JP Morgan because they bought the mortgage and the guy turns out to be a stupid pain in the ass?

Why don’t we bring back debtor’s prison while we’re at it

Did the lender actually keep the mortgage, or did he sell it to someone else?
If the later, he’s got no reason to check up on the marine’s income besides his own sense of honesty.
The lender probably just wanted a new swimming pool, and braces for his kid.
The former marine let him get those things painlessly.

It’s still fraud, even if his victim should have caught him on it.

For a lot of people, buying an oversized mortgage is how they end up being accidental yuppies. :stuck_out_tongue:

Once upon a time, I worked in the subprime mortgage industry. I worked for a couple of small brokerages you’ve never heard of, but my last mortgage job was with a very, very large subprime lender that you have definitely heard of.

(FYI: I was not a salesperson. I just did the paperwork.)

Some of the people I worked with were out and out scoundrels, but honestly, the biggest problem that I saw were that a lot of them had no fucking idea what they were doing. These dopes were given a couple days of training, told they would make a shitload of money, and then went to the phones, where they convinced other dopes who had no idea what they were doing that they should take these loans.

Stupid salesman: It’s okay to say you make $13k a month, don’t worry!
Stupid buyer: Really?
SS: Yup!
SB: Awesome! I’m gonna have a big house!
SS: Awesome! I’m gonna have a big bonus!

Yeah, these people should have read the paperwork more carefully (esp. because I was the person who prepared it and my work was GENIUS), but when you don’t know what all of the fine print means and the person who explains it to you doesn’t know what the fine print means, guess what happens? Clusterfuck!

So, I pretty much blame my bosses, who encouraged this to happen. I kinda feel sorry for the dude in question.

He didn’t read the paperwork. It’s his own fault.

Did he or did he not commit criminal fraud if he deliberately put down the wrong income, OR testified via his legal signature to having an income level higher than reality? And if so, how is that defensible?

An element of fraud is justifiable reliance on the false statement by the victim. If a lender, in the business of making very large mortgage loans, can’t even be bothered to take the necessary steps to verify the applicant’s income, how can they expect to complain when it turns out the representation wasn’t true? Besides that, if you go by what it says in the OP’s link it doesn’t seem like the borrower unilaterally decided to misstate his income; it seems the broker helped him along.

Kyla’s post highlights the reality of so many of these garbage transactions. Neither side knows what they’re doing, and both are trying to get ahead. Are we gonna imprison the lenders who should have known better?

Did he or did he not commit criminal fraud if he deliberately put down the wrong income, OR testified via his legal signature to having an income level higher than reality? It’s a yes or no question, either answer it or don’t.

If they commit criminal fraud, yes. If not, no. See, it’s not so hard to not duck a question.

No, he did not commit fraud if the lender couldn’t justifiably rely on the income he listed. Happy?

I can’t believe people are making this argument. It’s like arguing that if something isn’t nailed down, it’s ok to take it. If I lend my car to a friend of a friend, and I never see it again, did he not steal it from me? I admit it was stupid of me not to run a criminal background check on the FOAF, but it’s still stealing.

Oh wait, sorry, I forgot. It’s a large corporation, so it’s OK to steal from them. How silly of me to think otherwise. Fucking socialists.

Happy that you didn’t duck the question? No, but I respect you more. What’s your legal basis for saying that, FTR?

And I presume that it must work both ways - if the lender suddenly raises the interest rate from 5% to 25%, that’s cool as long as the lendee couldn’t justifiably rely on the interest rate listed, right?

I’m just going by the definition of common law fraud. As far as hiking the interest rate I’m not sure, but I assume there would have to be a contractual basis for doing so and that such a hike wouldn’t violate any state usury laws.

And dactylic hexameter, read the OP’s link. It indicates to me that the mortgage broker “helped” this guy along so that they could do the loan. That’s part of the problem. The broker has so much incentive to lend that he cuts corners. Or you could just bemoan the communist conspiracy taking over our country, your choice.

Maybe a lawyer like Gfactor can weigh in if he sees this thread.

I’ll post something substantive a little later.