Subprime Borrowers Say, 'Wow -- I Could Have Had a Prime Mortgage!'

Another good piece of enterprise reporting by Les Christie at CNNMoney.com: lots of people who were steered into expensive and risky subprime mortgages actually qualified for cheaper, prime-rate loans.

Under the headline "Wow, I Could Have Had a Prime Mortgage," Christie writes: "Imagine you're a homeowner, and you discover that instead of the expensive subprime mortgage loan you signed on for, you actually qualified for a prime-rate mortgage with much lower interest rates.

More: "I reviewed several hundred [subprime] loans recently for our wholesale division," said Allen Hardester, regional director of development for mortgage-broker, Guaranteed Rate, "and all of them, with one exception, qualified for a prime-rate loan."

More: "Fannie Mae estimated up to 50 percent of the borrowers, whose subprimes it bought that year, had credit profiles that could have qualified them for prime rates."

Comments? Thoughts?
Photo Credit: Reuters

Comments

[Angel Garcia]

Isn't this how some brokers make money. They sell the poor homebuyer a higher interest rate loan and split the potential difference with he mortgage company for selling the product. How dispicable. I wonder, who the heck are auditing these people. If 1 percent of all the containers can get checked, why not at least 1 percent of all mortgages?