OK, I’ve heard enough of this crap about “those thieving, lying borrowers” – as though there is no blame to the lenders. Let’s use an analogy, ok?
You are the owner of a liquor store. Your clerks are all on commission. You discover that some of them – the ones with MASSIVE sales rates – are using “stated age” before selling alcohol to the individual on the other side of the bar. A couple of your clerks (stodgy types, to be sure) insist on asking for ID — and needless to say are NOT doing as well. Having discovered this, you decide to say, “It’s OK to use stated ID.”
Then it turns out that minor are buying alcohol at your store. Now…
Who, exactly, is at fault here — and just how much “fault” is involved? The minors who knew they weren’t supposed to get it – and who lied about their age? (Yes. But they won’t spend time in jail.) The clerks who accepted “stated age”? (Yes. And they’ll serve time and pay fines.) You, who knew of and allowed “stated age” to be used? (Yes. You’ll serve time, pay fines, lose your license to sell and so lose your business.)
Now admittedly, selling a mortgage to someone without the means to pay isn’t going to put you in prison. Other than that, the analogy is quite solid. Well, not completely. We haven’t included the clerks who made sure kids leaving school knew they were selling booze with “we take stated income”. We haven’t included the clerks who saw the id (underage) but called it legal stated age anyway. These, however, are shading into the predatory and fraudulent – I’m just hammering the “who is stupid and deserves what’s happening” issue.
“These kids lied to me about their age and got drunk, send THEM to prison instead of me.” “What ID did you use?” “I asked them their age. I never expected they’d lie.”