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Personal Finances / Buying or Selling a Home


Subject:  This made me laugh Date:  10/10/2012  10:46 AM
Author:  CCinOC Number:  124375 of 128370

From a mortgage industry newsletter:

[quote] Here's one growth industry - lobbying on behalf of Wells Fargo Bank:

But lobbyists probably won't be able to help Wells--which prides itself on, among other things, having never ventured too far down the credit curve while other big-name lenders did and by doing everything by the book--with headlines like "U.S. Government Sues Wells Fargo." The U.S. government sued Wells Fargo over claims that the bank made reckless home mortgage loans for a decade. In a lawsuit filed yesterday, the government accused Wells Fargo "reckless underwriting" and fraudulently approving thousands of home loans that caused large-scale losses for the government's FHA DE [direct endorsement] program.

Wouldn't it be fascinating to have Wells pull up its stakes, as it did with its wholesale operation, and let everyone else do FHA DE-related home loans? That's just what our government, and housing market, needs! (Hah!) Seriously, here is the story.

The smart money has Wells fighting it, right after it takes the time and resources to train regulators and investigators what DTI [debt-to-income], DE [direct endorsement], LTV [loan-to-value], and CLTV [combined loan-to-value] stand for, whether or not alimony should be included in the income calculation, and what "delegated" entails. [How can one sue over that which one doesn't understand?]

Yes, there are advantages to being a bank, and being a big bank. But there are some possible disadvantages--like that darned stress testing. The FDIC (Federal Deposit Insurance Corporation) announced publication of its final rule regarding company-run stress testing required by the Dodd-Frank Act. The rule applies to covered institutions with total consolidated assets greater than $10 billion of which, as of June 30, there were 108 institutions. Here are 42 pages of fun. [quote]
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