Mortgage brokers are out and direct lending is in. Many of the major mortgage lenders that brokers dealt with nationwide have either gone out of business, been acquired or pulled back. Some are under indictment for mortgage fraud, while others – both mortgage brokers and mortgage wholesalers – are telling about sex, drugs, parties, and a general attitude of “mortgage whores.” The degree to which that describes the industry is unknown, but local mortgage brokers in our area disappeared like Jimmy Hoffa. Federal and state prosecutors are picking through the industry’s wreckage in search of criminal activity.
To see how HSBC, a leader in subprime, is adopting a new strategy we studied how the bank reacted after losing approximately $42 billion dollars. More employees were dismissed at HSBC’s Depew facility.
Before people start sending cards, letters, and emails let me make it perfectly clear that all mortgage brokers were not dishonest, nor did they all grant sexual favors in exchange for loans. What turned out to be ironic are the number of homeowners who were the targets of such loans. These people didn’t even get a free tube of KY Jelly.