This new legislation makes it harder to be taken advantage of. 55% of people who had sub-prime mortgages qualified for prime ones.:confused: Brokers try to get people the worst possible mortgage because then the brokers make more money.:rolleyes:
Link to article (http://www.bloomberg.com/apps/news?pid=20601087&sid=aTUHRnSHrPDc&refer=home)
A step....
The vast majority of banks are doing nothing wrong; they are not predatory, they are not attempting to rip off their clients, and most of them simply allowed themselves to be caught up in the bubble. They became overleveraged, invested far too much in abstract mortgage-related securities, and when the bubble burst the entire situation just fell apart. Even so, the problem is not a crisis; over 95% of mortgages are on time, even many subprimes, and the feared bleeding in to the rest of the economy has generally been contained by swift action by the world's central banks.
What this legislation does is address the actual violations in the industry, mainly the stated-income loans that allowed people who did not deserve them to receive large loans that they were almost certainly unable to repay. These loans were usually targeted at financially illiterate people and were generally predatory in nature. That's it.
As much as people might not want to believe it, banks do adhere to ethics and are interested in making money honestly, not through misinformation or manipulation. The people running these institutions are almost all honest, competent, and ethical in their business practices, and to smear them for the actions of a few corrupt and unethical lenders is unfair. Without banks, the modern market economy would not exist and we would be little more than impoverished peasants toiling for a feudal lord.
The Black Forrest
20-12-2007, 08:05
As much as people might not want to believe it, banks do adhere to ethics and are interested in making money honestly, not through misinformation or manipulation. The people running these institutions are almost all honest, competent, and ethical in their business practices, and to smear them for the actions of a few corrupt and unethical lenders is unfair. Without banks, the modern market economy would not exist and we would be little more than impoverished peasants toiling for a feudal lord.
Eh?
So how is it honesty to charge 35% interest for 6 months for a late payment?
How is it honest to take payments in a certain order to guarantee a late fee?
How is it honest to apply fees in order to force an overage fee?
How is it honest to campaign for the limitation of good credit information and campaign to increase length of bad credit information?
How is it honest to charge $3 for a .05 transaction?
They do enough to warrant smearing.