Saturday, January 17, 2009

Crooks, Liars and Fools: The New Faces of America

Time for a more serious post. Well, certainly more serious than my last post about the shoes (although, truth be told, I am pretty darn serious about my shoes these days!). This post, however, is about personal responsibility and the state of mind of the American public. I was reading a story online the other day about a lawsuit brought by homeowners against Countrywide Home Loans. I couldn't decide who I was more disgusted with; Countrywide or the homeowners. It's pretty easy to be disgusted with Countrywide. They leave themselves wide open for contempt at every turn. They've engaged in everything from chumping their own employees out of overtime pay to making an astounding number of sub-prime loans which have most certainly contributed heavily to the current mortgage crisis our country is in. Oh, and Countrywide is also the company who made loans at extremely favorable rates to the likes of Senators Dodd and Conrad (both Democrats) and James Johnson and Franklin Raines (both former CEOs of Frannie Mae). Yeah...fine upstanding people running that place, NOT! Anywho, Countrywide is being sued by a couple who had been seeking a "loan modification" for their mortgage. You have to understand that, since this mortgage crisis and Countrywide's role in it have come to light, Countrywide's been telling anyone and everyone who will listen (particular those in Senate hearings) that they are working oh so hard to modify mortgages for their financially strapped customers to prevent foreclosures whenever possible. Well it seems that this couple in New Hampshire had worked with Countrywide for more than 8 months in an effort to have their loan modified before Countrywide finally flat out refused to adjust their interest rate. As a result, the couple lost their home to foreclosure because they couldn't catch up on their lapsed payments, etc., etc., etc. Since then, these homeowners filed a lawsuit against Countrywide alleging breach of faith, fraud, negligence and misrepresentation due to Countrywide's failure to make good on it's marketing, advertising and testimony before Congress in which Countrywide has repeatedly made assurances that they are "working hard to modify the mortgages of financially strapped borrowers caught up in the sub-prime meltdown". Attorneys for the lending giant are telling a different story, however. While those testifying on Capital Hill are painting themselves as benevolent lenders out to help the "financially strapped", their attorneys call such claims and assurances “mere commercial puffery.” Saying the modification offers are “only Countrywide’s vague advertisements,” Countrywide's attorneys are asking the court to throw out the lawsuit. That's just too funny to me. They're asking the court to ignore their own propaganda because they'd just as soon not be held to the standards they themselves have touted. Can you be anymore ballsy? Really? "Yes, Your Honor, we did say we would work with our clients but that was just to help our public image and to keep Congress off our asses. We didn't really mean it. Geez!"
Hell of a defense there, eh? No word yet on how that defense is working out for them. Wouldn't surprise me if they were successful with it though. That would just about fit the pattern our judicial system has engaged in these past couple of decades.

Okay, so Countrywide has shown itself, yet again, to be a lying, back-stabbing, shamelessly self-promoting corporate behemoth with absolutely no soul. What could the homeowners possibly have done to make me disgusted with them as well when compared to Countrywide's transgressions? Well I'll tell you. These people were in their early 30's when they bought this house. The husband is an electrician, the wife a stay at home mom to 2 kids (currently ages 2 and 5). This was their first home purchase. They got a first mortgage and an equity line of credit (to finish the upstairs on this "new" house) that totaled a little over $230,000. They claim that, since this was their first home purchase, they were "unfamiliar" with some aspects of the purchase and wound up with adjustable loans with interest rates that could climb as high as 12.8 percent on the first mortgage and 18 percent on the equity loan. I just gotta know...did they ever buy a car before? Did they have any credit cards? Do they have any credit history whatsoever because if they did, they should have had at least some inkling that perhaps signing paperwork that would commit them to almost a quarter of a million dollars worth of debt at an adjustable interest rate may not have been the smartest thing to do. And if they didn't know that, what in the hell were they doing even thinking about buying a house to begin with? This really burns my butt. People put themselves into financially irresponsible positions and want to blame everyone but themselves for it. Yeah, I'm real sorry they were lied to by Countrywide and I'm real sorry they ended up losing their home. But the lender is not the only one to blame in this tragedy. The homeowners bear much of the blame, too. But in this country, it's become acceptable to make excuses for one's own shortcomings. These people can say "we didn't know" or "Countrywide lied to us" or "we didn't understand" and people left and right will "there, there" them, pat them on the head and tell them it's not their fault. Well it is their fault. It's their fault if they entered into a legally binding contract by placing their signatures on a piece of paper without reading that paper thoroughly. Yeah, it's fairly boring reading and there's a lot of language in those contracts that can be confusing, but nevertheless, it's the borrowers' job to read the "fine print" before they sign on that dotted line.

As far as I'm concerned, Countrywide and this couple define what is wrong with America today. An evil corporate giant on one side; lazy, whining Americans on the other. It's almost laughable how we wonder why the world thinks Americans are bloated and stupid with our own sense of entitlement and greed. I'm afraid there's a reason for that belief. It's because we are.


  1. well maybe the world ir I just want to make ends meet every month and not worry about loseing my home because of bad lending practices of the greedy bankers.

  2. Yeah, the banks were making mortgages to anyone who applied, even if they weren't qualified. But the people getting the mortgages? Surely they should have realized that they couldn't afford the houses. I'm sure a lot - a LOT - of these borrowers bought way more than they needed just because the bank would give them the money to do so. What's wrong with starting small? Does a family consisting of just a husband and wife really need a 4 or 5 bedroom, 3+ bath house with a finished basement and a 3-car garage, huge kitchen with granite countertops and all the fancy appliances? What's wrong with a "starter" home - 2-3 bedroom, 2 bath, in an established neighborhood?

    When we bought our first home, that's what we did. We knew how much we could afford to pay each month and looked for a home that would meet our current needs and budget. When we had more money and more family, we moved up - but again to something we could afford.

    I look at our neighborhood. There are so many young couples in these big expensive houses. Some of them don't have furniture in some of the rooms because they can't afford it. I found a site online where I could see the financing used in this neighborhood. At least 95% of the owners took out 2 mortgages, one for 80% to avoid PMI and another for the remaining 20%. They bought these houses with nothing down, so they have no equity in the house at all. Our developer was so anxious to sell that they would refer the buyers to a specific lender who would work out this double mortgage deal.

    And all around us, there are new developments being built, with homes starting around $400,000. And these young kids are buying them because the banks would give them the money to do so, even if they can't afford to make the payments.

    It's a shame that people in this country feel they have to live above their means and have it all right now, instead of taking their time and working toward their dream home. And that the money lenders will help them make the wrong decisions.

  3. I wish you were our President.

    Truly, why don't we get people in there that have a real understanding of what is going on? I am appalled that there were no checkpoints on the buy out. What the hell was that? For crying out loud, I have to account for every penny I claim on my IRS form and these companies get billions that they are not accountable for??? Whose smart idea was that???

    Great post.

  4. Talk about a change of subjects. From shoes to this! LOL

    You're so right...people are c-r-a-z-y!


  5. I agree with you completely. The lack of personal responsibility in the general public right now is apalling. I read a statistic back in the summer from a poll conducted. 1000 people were asked what kind of mortgage they had (e.g., fixed, adjustable, 30 years, 15 years, etc.). 31% DIDN"T KNOW! Ummm, these people signed on the dotted line and commited to the largest financial purchase ever and they didn't know what they committed to? God help us. Irresponsibility and lack of discipline (e.g., waiting to purchase a house you CAN afford) has gotten the nation into this financial mess.

  6. Everytime I turn on HGTV and see people actually think they can afford a home that costs a million, I want to throw something at them...houses are not what they used to everyone wants a mansion...I feel sorry for Fantasia, but jeezopete, she has one daughter, what made her think she needed that huge house? I would have been happy with shelter from the storm...people don't seem to want that anymore...they're all Arkansaw travelers, fiddling in the rain...great post!

    Aunt Sandi

  7. Sadly this is our world today. As usual you express it so well. Hugs, DebraK

  8. Ahhh, the Kari we know and love :-) Well said, and yes, what were those people thinking??? Should all companies be held responsible when we don't know what the heck we're doing? And if so, why do we sign contracts to begin with?
    I can't wait until it comes down to "Well yes your Honor, my client signed the contract, but she doesn't know how to read".

  9. Kari, visit my blog - I've given you an award!

  10. I disagree with your comment that these people were lazy whining Americans. Are you familiar with every individuals circumstances or stories? Have you read stories regarding predatory lending. I suggest that the next time you decide to judge someone, or group them into a catagory as you did, you find out the facts about what is really going on.
    I don't mean to be rude, but as someone who is going through the sub prime crisis, I find your post offensive. I take personal responsibility for my auctions, and from the original article on MSNBC it sounded like these people did as well. They were sueing because they got the run around from the mortgage company? Surely the mortgage company should be held accountable. The story is similar to mine, and it is unfortunate that people judge based on facs that they do not know. I highly suggest you get out on the web and read about what these companies are doing to people who are just asking to lock an interest rate.

  11. This article truly lacks education. I recommend you look up or re watch "House Of Cards." Look up "Date Lines" program on Mortgage Fraud on U-tube. Researh and study stated income-no doc-option arm loans.
    We all walked into the brokers office for the first time with our two years taxes, bank statements, faith and trust. The brokers lured us into High Yield Premium (pays them the highest commision) loans. While Real estate agents pushed us for the act fast 45 day escrow.

    Ask yourself this question. When your sick and you don't know what is wrong with you, your doctor tells you and writes you a prescription. Do you challenge their advice? Do you question their education and knowledge? NO! You accept his or her advice as a experience professional allowing them to take care of you. I guess it would really BURN MY BUTT hearing about you sueing for malpractice since you didn't bother to get a second opinion or reasearch your illness before visiting your doctor.

    Do you really believe most of us elected to place large down payments, move furniture, and make high mortgage payments beyond our financial means?

    I don't mean to be rude, but it sickens me that I placed my life savings into my home only to discover two years later I'm in a liar loan I could never afford. And now not only will I be losing my home and life savings for trusting my broker. I'm now being called stupid and a liar.


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