They didn’t “not catch” him. They stuck their fingers in their ears and said “LALALALALALA! DON’T TELL ME ABOUT YOUR FINANCES, JUST SIGN AND I’LL CUT YOU A BIG CHECK!” figuring that the worst outcome would be kicking the family to the streets and getting all their money back in the foreclosure.
They never asked for some sort of income verification? Hell, I had to hadn over paystubs, bank statement, 401k statements, photographs of my mattress to show there was no money there, video of me digging through my sofa cushions, etc. before they allowed me to sign for a loan.
Where did I defend his actions? By stating that the other party in the contract didn’t do thier homework therefore they share some burden in the problem?
Had the lender done thier homework, this person wouldn’t have had the ability to fuck anyone over… should he be punished for what he did do? Sure - but his fraud should’ve been caught (and dealt with appropriately) before any money ever changed hands.
The bank fucked the bank. They lend this guy hundreds of thousands of dollars without having the slightest idea whether or not he can pay it back, and you act like they’re poor widdle victims who fell into this criminal mastermind’s plot.
The banks are every bit as responsible as the borrowers, except that they are supposedly financial professionals instead of schlubs looking for the “American Dream”.
Doesn’t negate his criminal act. Which is my point.
At what point does a person over 18 years of age become responsible for their own legal and financial consequences? When they’re 25? 30? 40? The guy in the OP is 45 freaking years old, and he somehow just. Doesn’t. Get it.
Do we need to have some sort of financial IQ test before we allow adults over 18 years of age to take out loans?
Can I live rent-free in a house worth more than 1/3 of a million dollars for four years, and then wait for Super ObamaMan to bail me out? Why don’t we all just do that - only chumps and dumbshits take out mortgages they can pay for and make payments on them. I feel so stoopid. :rolleyes:
There are millions of people busting their fucking asses, taking on second jobs, making cutbacks, chipping in, putting their shoulder to the grindstone to make their families strong and safe. Working single parents, struggling young people right out of college trying to get into their first house. Folks that just lost one, or maybe two household incomes. Families doing the right thing and showing honesty, integrity, and financial wisdom.
Then there’s the guy in the OP, who is going to get his bailout and laugh about it over a cold one.
No they did not, no matter how many times people repeat it. I fear for anyone who ever lends money to someone who thinks “hey, as a lendee I should be able to get away with anything I can. Free money! Woo hoo!”
No they are not, hence the criminal code cited by Gfactor earlier. The person who commits fraud is criminally responsible. The person who has fraud committed on them is not criminally responsible. Is that fact actually in dispute here?
Yet he was smart enough to dodge foreclosure through a variety of ruses for 4 years and to get his sob story to air on CCN.
Listen, Section 1001 of Title 18 is one of the broadest reaching federal criminal statutes there is. Read this if you don’t believe me. You can’t point to that statute and say “AHHH, AHHH, see, he is a criminal bastard and they should lock him up.” Section 1001 deals with lying to the government, not fraud. It doesn’t directly speak to what happened here nor countless other transactions just like it. ANYONE could violate Section 1001 and not even realize it.
Could he conceivably be prosecuted under Section 1001? Certainly. It’s a broad statute. But the government isn’t going after this guy no more than they’re going to go after everyone who has ever downloaded an album online. There just isn’t enough resources to do it, and you shouldn’t want them to devote what resources they have to going after people like this. This entire mess was encouraged and tolerated by the Bush administration for years. Do you really think this guy’s situation is so unique?
Am I saying he’s a victim? No. Am I saying he should be bailed out? Absolutely not. But this whole situation is messy enough without locking up everyone who wanted in on something that was too good to be true.
I think he gets it. 
As opposed to the lender who thinks “I can give money to anyone I want, just as long as they tell me they are good for it.” It is entirely moronic that the banks gave people money without checking their financial record, then are “not to blame” when the loans go bad.
The banks are jointly responsible for the bad loans. They are not at all responsible for people lying on their application. They are entirely responsible for ridiculously lax lending terms that allow huge loans with absolutely no review of the borrower’s financial status.
We’re going to have to agree to disagree on this one, guys, as we are clearly not going to have a meeting of the minds on this subject.
If you can’t provide more of a counterargument than saying “fraud” over and over in the hopes that it will eventually mean something, then I have to agree.
A deliberate misrepresentation of my position, which has been made perfectly clear in this thread: anyone who thinks you can freely lie about your finances on legal financial documents and not be guilty of fraud needs help.
Was this really so hard to Google?
From: http://www.hud.gov/offices/hsg/sfh/buying/loanfraud.cfm
(emphasis added)
If you have a problem with what the Department of Housing and Urban Development says on their website, then you need to present a lot more proof than you have in this thread.
And I’m pretty disappointed that you couldn’t let my non-snarky, non-denominational last post just admitting that we were not going to agree on the subject go without a shot at my back. Now I get to embarrass you with a cite, and you get to play duck-and-weave to try to convince the crowd here that “overstating your income”, “fraud”, and “criminal penalties” don’t really mean what they mean.
Una’s argument seems pretty cut and dried to me, MOIDALIZE.
This guy’s misrepresentations were so blatant and out-of-line with reality that I think it would be a great idea to prosecute, fine, and imprison him. Granted, prosecutorial resources are limited, but if I was going to pick someone to make an example of, this lying asshole fits the bill.
From: http://www.federallawgroup.com/PracticeAreas/Bank-Fraud-Mortgage-Fraud.asp
From: MORTGAGE FRAUD BEGINS AT LOAN APPLICATION
Sounds like it is fraud, and criminal, to lie about your income. But then, those are just all Googled links, I’m sure they must all be wrong. Let’s see what the FBI has to say about it:
From: http://www.fbi.gov/publications/fraud/mortgage_fraud06.htm
Seems clear to me.
There is a slight distinction here - The quote you just gave from HUD is from a Federal form - not a generic “mortgage” application, even then - Penalties on that form “may” result in criminal penalties - so even there those penalties are not “garunteed”.
So, yes - the marine committed fraud - he should be prosecuted/penalized as the law permits - no one questions that (at least not that I saw) - the point that many others, myself included, are trying to make is that the Lender also must shoulder some responsibility in this fraud - since they had the means to prevent the monies from changing hands. Now, reality is, that the lender is being penalized - they’ll suffer losses as a direct result of not doing thier due diligance on the lendee.
However, it is not the marine that “fucked” everybody over on this - it was the lender, and other lenders like them, that allowed these types of loans to take place.
This marine should not be able to take advantage of any bail out program - since he committed fraud in the initial application.
I feel you are confusing the two - yes, the marine is a good example of a loan that shouldnt have happened - but it is ultimately the lender that decides yay/nay to any loan request - if they make bad choices - reguardless of the authenticitiy of the borrowers statement, then they are the ones who must shoulder at least partial responsibity for the situations that occur afterwards. Even moreso since they have the tools to validate the borrower’s statements.
ETA - legit question - are all Mortgage loan forms considered Federal docs?
From: http://www.ice.gov/pi/news/newsreleases/articles/080225baltimore.htm
I can find these things all day long, but sadly I must return from break to keep working so I can help fund the bailout of the guy in the OP.
I don’t think there is anyone disputing that the dude committed mortgage fraud - and should be dealt with accordingly.
What you are failing to recognize is that it is still the lenders responsibility to validate information before the money changes hands.
If they would have done that much, you could still get the fraud convictions all day long, but there would not have been all this bad loan debt running around.
A couple of quick points:
- Form 1003 is a standard form for most mortgages. It was used in every stated and no-doc loan I’ve ever seen. It’s a Fannie Mae document, actually–not a HUD document.
- The statute (18 U.S.C. 1001) says:
That’s pretty broad. For example, TILA, HOEPA, RESPA, and HMDA cover an awful lot of territory and subject a lot of transactions to federal regulation and scrutiny.
3. Does it cover every loan? Probably not.
- Does the use of the form in a transaction that isn’t within federal jurisdiction subject the borrower to section 1001? I doubt it.