Capital New York

DRC commented on Bloomberg: 'Plain and simple,' Congress caused the mortgage crisis, not the banks

Pfw51- Your "facts" are lies. They are simply not true. The great majority of bad loans were done by non-bank lenders like Ameriquest, Countrywide and New Century. No one was forced to lend on these subprime loans by any governmental agency. They were done purely for greed because you could charge 5.0%+ in points and fees upfront and then bundle and sell the paper through a company like Goldman Sachs for up to another 7%. That 12% is before any of the high interest rates being charged was collected. That was on loans with little to no income documentation and questionable appraisals. Goldman, et al would then turn around and sell the "AAA-rated"*** paper to unsuspecting pension funds, etc. This worked until the bubble burst and many investors would left holding the worthless paper that was known to be worthless when it was sold to them and the millions of homeowners that were sold a bill of goods to do these loans and the tens of millions of homeowners that bought or refinanced property at the market peak. All so people like Roland Arnall (owner of Ameriquest) could become billionaires and contribute so much to political campaigns that they would be named Ambassador to The Netherlands by GWB. All of this because there was NO regulation. Feel free to refute but please use actual facts.

Posted on November 1st, 2011 5:22pm