Q) When my wife and I bought our home, we had to provide a mountain of documentation, including federal tax returns. How have the mortgage lenders allowed illegal aliens to enter into a mortgage loan without the proper documents?
A) The Sub Prime underwriting guidelines had special requirements for, what was called, Foreign Nationals….30% down and full credit package including credit references from their country of origin and a valid Visa. To circumvent this requirement, the applications were marked that the borrower was a US citizen then, regardless if the credit profile did not support such a claim, an underwriter was not allowed to question. This along with use of stolen SS# or use of their American born child’s SS# and lax credit requirements that allowed alternative credit, helped cover the ruse. All required documentation was fraudulent and with the large use of a/k/a’s, information was hard to track.
Q) What did management do when it was discovered that a stolen Social Security number was being used by a borrower?
A) It was not uncommon to find a SS# being used by up to 23 other people or a borrower with 27 a/k/a’s. Management would often clear a loan that you tagged as fraudulent so it wouldn’t be shelved.
Q) What was the worst case you have seen?
A) One borrower stole the SS# of a retiree and took out $3.5 million in loans, turned around and did cash-out refi’s, then fled the country. The retiree was left with ruined credit, $3.5 million in loans and trouble with the IRS. Over 50% of the sub primes were for cash-out refi’s. Regardless of the loan criteria used to pull random samplings for audits, the majority of the last names were Hispanic. The loans I audited were primarily in CA, NV, AZ, FL, CO, compare those to the states with the highest number of foreclosures & illegal aliens.
-more here
...
