Essay On Ethics In Mortgage Lending

However, hope might be on the horizon for the victims of the mortgage disaster of 2007/2008. Home buyers who were foreclosed upon years ago, or boomerang buyers, are beginning to be eligible to buy homes again. While some feel hope after feeling bamboozled by lenders and Fannie Mae and Freddie Mac, some feel anxious and fearful of the thought of buying again. Yet there are lessons that have been learned by the mortgage meltdown. Fannie Mae and Freddie Mac provided a lesson for the

Predatory lending has caused many conflicts in the American society. Victims who fall for predatory lending are

The housing crisis of the late 2000s rocked the economy and changed the landscape of the real estate business for years to come. Decades of people purchasing houses unfordable houses and properties with lenient loans policies led to a collective housing bubble. When the banking system faltered and the economy wilted, interest rates were raised, mortgages increased, and people lost their jobs amidst the chaos. This all culminated in tens of thousands of American losing their houses to foreclosures and short sales, as they could no longer afford the mortgage payments on their homes. The United States entered a recession and homeownership no longer appeared to be a feasible goal as many questioned whether the country could continue to support a middle-class. Former home owners became renters and in some cases homeless as the American Dream was delayed with no foreseeable return. While the future of the economy looked bleak, conditions gradually improved. American citizens regained their jobs, the United States government bailed out the banking industry, and regulations were put in place to deter such events as the mortgage crash from ever taking place again. The path to homeowner ship has been forever altered, as loans in general are now more difficult to acquire and can be accompanied by a substantial down payment.

Bank of America thrives off of the premise that they are aiming to enhance the financial lives of their customers. Per the Code of Conduct, Bank of America believes in treating all of their customers equally; they claim to expand beyond expectations to deliver satisfactory customer service; they implement discipline to eliminate financial risks to customers; they pride themselves on acting responsibly; and they strive to help individuals to reach their full financial potential. This company enforces the belief that they honor their ethics fully. This includes making

The foreclosure crisis is a family affair. Usually it is well intentioned parents trying to buy homes that are out of their price range and affordability, so that their kids can go to good schools and be proud of where they live. The source of the problem may lie in the psychology of the way we as Americans think. We cannot allow ourselves to try to keep up with the Jones’, because if we do we will ultimately outlive our financial resources and get into trouble, as so many families are doing. There needs to be family counseling, strict guidelines on what families can borrow, and an all out public relations campaign designed to show what is at the root of the problem, the attitude that I can have it all, instead of “I have what I need

Are bad credit mortgages still available to those borrowers who want to purchase their first home or refinance that high rate adjustable rate? Mortgage professionals get asked this question all of the time and the answer may surprise you. The reason that the answer may surprise you is that we seem to be inundated daily with financial experts telling us that the current economic recession was brought on primarily because of bad credit mortgages. Reading and listening to all of this would lead you to a quick conclusion that anyone with a low to moderate credit score should resign themselves to being locked out of the housing market or the refinance market for a very long time. Not so.

Thursday started busy, with everyone scrambling to pack and clean up the place we were staying at.

As a topic for this research paper, I decided to analyze the ethics behind the recent mortgage crisis in the United States. Banks were approving people for loans very easily, to people they knew would not be able to pay them back. Thus, many people were buying homes, missing payments, getting foreclosed on, and ruining what credit they had. Throughout this paper I intend to show how the practices that the banks were using were unethical. I will show who stakeholders were, and analyze them through Utilitarian and Kantian standpoints.

After about fifteen years of counseling shoppers for various kinds mortgage loans, I have presumed that most "mortgage agents" don't help the borrower by giving great money related exhortation. Most loan representatives simply back off the procedure for candidates since they put their payments before the best enthusiasm of the candidate. Try not to misunderstand me, helping individuals in a monetary exchange like a home buy or mortgage renegotiate is basic, yet just if the land proficient has experience and their customer's best enthusiasm on the most fundamental level.

Already in poor financial shape from a downturn in the economy, Bank of America compounded its problems by acquiring Countrywide Financial, the largest mortgage originator in America (at the time) in 2008 (Maxfield, A Brief History of Bank of America in Crisis, 2015). This acquisition proved to be a very huge mistake for the bank. Countrywide lacked integrity when it came to underwriting and selling mortgages and had very unethical loan origination processes. Its property appraisers inflated home values, its loan officers helped applicants falsify income and assets on their mortgage applications, and its capital markets teams misrepresented the quality of the resulting mortgages to institutional investors like Fannie Mae and Freddie Mac (Maxfield, A Brief History of Bank of America in Crisis, 2015). The result of this one poor business acquisition alone was years of legal issues and losses.

Once upon a time, Countrywide was the nation’s largest mortgage lender; and today it is an embarrassment that even the remains of the name of the company has died out.

In 2003, Coleen Colombo joined the California branch of BNC, where she worked as a senior underwriter. The BNC office in which Colombo worked was part of the regional group that offered a considerable amount of loan to its customers. The performance of Colombo in her work was outstanding. This is according to a wrongful termination and harassment suit filed in California Superior Court on her behalf and on behalf of five other BNC employees. The suit states that the work environment began to become hostile for Colombo in 2005 after one of her fellow employees, a male wholesaler,

One of the first indications of the late 2000 financial crisis that led to downward spiral known as the “Recession” was the subprime mortgages; known as the “mortgage mess”. A few years earlier the substantial boom of the housing market led to the uprising of mortgage loans. Because interest rates were low, investors took advantage of the low rates to buy homes that they could in return ‘flip’ (reselling) and homeowners bought homes that they typically wouldn’t have been able to afford. High interest rates usually keep people from borrowing money because it limits the amount available to use for an investment. But the creation of the subprime mortgage

Establish Credibility: According to US News, the great American dream of owning a home appears poised for a comeback. Real estate company Trulia reports that in many parts of the country, rents are rising while housing prices are falling, making buying a home more affordable. Trulia found that in 98 out of 100 major metropolitan areas, including Detroit, Atlanta, and Cleveland, buying has become more affordable than renting.” I think the mortgage catastrophe of 2001 left prospective home buyers afraid of buying a house without being extremely certain that is the right decision.

Then previous summer came the subprime crisis across the Atlantic. By end of the summer, there was a run on a British lender, Northern Rock. A month later, mortgage approvals dropped 31 percent, compared with the number in the previous year, and by November, real estate brokers began reporting the first declines in housing prices. In March, average prices fell 2.5 percent, the largest monthly decline since 1992, according to HBOS, a mortgage lender. (Mark Landler, 2008)