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View Diary: William K. Black to FDIC/Obama: Stop the Friggin Fraud (178 comments)

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  •  There also was a real segment of (0+ / 0-)

    society that was underserved by the full-doc mentality. Alt and limited doc programs started out being a godsend to everybody who is self-employed or wanted to buy real estate with a substantial down payment but not have their tax returns scrutinized. In the end the programs did go too far, but they started out a very good idea.

    I'm in the I-fucking-love-this-guy wing of the Democratic Party!

    by doc2 on Fri Oct 22, 2010 at 06:33:52 PM PDT

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    •  I am sure you are right but once those loans (1+ / 0-)
      Recommended by:
      Badabing

      reached critical mass, somebody should have spoken out.  The system has no brakes for bad behavior.

      "When fascism comes to America, it'll be wrapped in a flag and carrying a cross." Sinclair Lewis

      by lakehillsliberal on Fri Oct 22, 2010 at 07:30:46 PM PDT

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    •  Whoa whoa whoa (0+ / 0-)

      doc2, I agree with you a lot, but

      who is self-employed or wanted to buy real estate with a substantial down payment but not have their tax returns scrutinized

      suggests that people who engage in tax evasion need to be served in the mortgage market. One, I'm cool with legal tax avoidance, but not tax evasion. Two, this is a slippery slope to

      In the end the programs did go too far

      that is probably unavoidable, as where do you draw the line? Full-doc served us very well for decades before the housing/credit bubble.

      One night in Bangkok makes a hard man humble ... Murray Head

      by virginislandsguy on Fri Oct 22, 2010 at 08:41:14 PM PDT

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      •  It's not tax evasion. Some people (0+ / 0-)

        do not want to disclose their tax information to the outside world. It doesn't mean that they didn't pay taxes, or that they underpaid. It just means that they are private, or that while they didn't have much income last year they are now in good shape.

        I'm in the I-fucking-love-this-guy wing of the Democratic Party!

        by doc2 on Fri Oct 22, 2010 at 10:12:37 PM PDT

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        •  Ok, I'll stipulate it's not a case (0+ / 0-)

          of tax evasion, but financial privacy. If they are not willing to open the kimono as in a regular mortgage, then they will have to provide additional downside protection for the lender. This could be via a higher down payment, say 25% to 35% and/or a higher interest rate. That would go a long ways in eliminating the speculators and fraudsters.

          One night in Bangkok makes a hard man humble ... Murray Head

          by virginislandsguy on Fri Oct 22, 2010 at 11:53:37 PM PDT

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