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I recall there being some contentions that the notion of "predatory lending" was fabricated nonsense.
Affidavits by insiders from Wells Fargo's subprime loan department say otherwise.
As if this wasn't bad enough, the blatant racism running through the entire division is disgusting.
Affidavits by insiders from Wells Fargo's subprime loan department say otherwise.
Loan officers employed other methods to steer clients into subprime loans, according to the affidavits. Some officers told the underwriting department that their clients, even those with good credit scores, had not wanted to provide income documentation.
"By doing this, the loan flipped from prime to subprime. But there was no need for that; many of these clients had W2 forms."
Other times, loan officers cut and pasted credit reports from one applicant onto the application of another customer.
These practices took a great toll on customers. For a homeowner taking out a $165,000 mortgage, a difference of three percentage points in the loan rate - a typical spread between conventional and subprime loans - adds more than $100,000 in interest payments.
"The company put bounties on minority borrowers. By this I mean that loan officers received cash incentives to aggressively market subprime loans in minority communities."
Both loan officers said the bank had given bonuses to loan officers who referred borrowers who should have qualified for a prime loan to the subprime division. Ms. Jacobson said that she made $700,000 one year and that the company flew her and other subprime officers to resorts across the country.
As if this wasn't bad enough, the blatant racism running through the entire division is disgusting.
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