Sentences with phrase «liar loans»

Driven by Wall Street's demand for subprime loans to securitize and sell to investors, lenders sold high - risk products such as exploding adjustable - rate mortgages — loans with interest rates that could triple after two years — and liar loans, also known as stated income loans, which required little or no documentation about income, assets, or credit history.

These are different from the go - go years paving the way to the breakdown in 2008, when lenders would lend money to borrowers with poor credit, or in the situation of liar loans, zero credit at all.

These liar loans were one of the first casualties of the mortgage market meltdown as many of these customers were some of the very first people to end up in foreclosure.

In fact, after the subprime mortgage crisis of 2007 - 08, they became known as «liar loans,» because borrowers and lenders were able to exaggerate income and / or assets to qualify the borrower for a bigger mortgage.

Also known as «liar loans,» this is when borrowers were allowed to simply say what their income was, without having to prove it.

, and (3) many don't have debt ratios to qualify, since (3a) many were liar loans to begin with, or (3b) they've racked up too much new debt to pay spiralling property tax, energy, health insurance and food costs, or (3c) incomes have fallen or (3d) they qualified for the subprime loan at 45 - 50 % debt ratios and don't meet the 43/45 % FHA total debt ratio.

He's also rumoured about to end stated - income mortgages, those «liar loans» the banks hand out to self - employed and commissioned people.

Informally, these loans were aptly referred to as «liar loans» because they encouraged borrowers to be less than honest in the loan application process.

The bubble was a combination of (a) teaser rates on option ARMs which were like financial time bombs, (b) liar loans in which the rules of good mortgage underwriting (20 % down, 28/36 ratios) went out the window, (C) people at rating agencies who decided that if one pools enough junk loans into one bond, it's magically AAA, and (D) Credit default swaps which encouraged these bad loans, and when they collapsed a number of people walked away with billions of dollars.

Private sector subprime seduced innocent borrowers into taking out liar loans.

Eventually, as a consequence to these «liar loans» being abused, these defaulted loans became virtually extinct.

It was sort of based on job opportunity, something called «elite graduates» and data from Moody's (the same Moody's that rated many liar loans bundled as CDO's as AAA + so we know * they're * reliable).

When i was 20, i bought 5 buildings in 5 years during the no doc loan years with a bunch of liar loans.

The banks and mortgage brokers, however, knew these were unqualified buyers, as their inside jokes about liar loans and Ninja loans (no income, no job or assets) attest.

This cuts out people who took «no - doc» and «stated - income» loans, also known as «liars loans,» which hid the fact that they earned too little to qualify.

And using a mix of option ARMs, interest - only loans, sub prime teasers, and liars loans, borrowers flooded the markets with a level of demand that will never be seen again - the result was a doubling of home values.

A liar loan is a type of mortgage loan where a lender does not verify an applicant's income.

The similar Liar Loan refers to a category of mortgages known as low - documentation or no - documentation mortgages.

Not exact matches

I personally know several people who still have interest - only mortgages and had been enjoying negligible payments for years now, but have no idea how to pay back the principle on their liar - loans and more terrifyingly for them little understanding of what their monthly payments could escalate to with inflation at say 4 % in a couple of years time.

Enron, Lance Armstrong, subprime loans, Donald Trump — lies and liars have become as evident as they are rampant.

Unless the debt relief industry adopts a policy for student loan assistance like the one above, it will only be a matter or time before the scammers and liars hurt consumers and regulations and enforcement actions begin.

Doesn't really make a difference if it's a liar's loan or you don't have the income or something because even if they have to take it over, it'll be worth more next year.

In his other finding on causation he ruled that even if the sisters had questioned Shaid Luqman about whether the directors» loan account was genuine rather than turning a blind eye to it, Shaid Luqman as an accomplished liar would easily have been able to convince them of its propriety.

The banks put out interest only loans, no - doc liar's loans, pick - a-pay neg - am loans, buyers qualifying for mortgages using the teaser rate only, and of course, we had an ever expanding number of house flippers and first - time, mom - and - pop, «Law of Attraction» blind optimist wannabe real estate investors who were signing those toxic mortgages.

And of course, we can't forget all those geniuses who lied about their incomes on their no - doc, liar's loans and then found out they couldn't afford the monthly payments.

To qualify for a stated income loan (sometimes call ed a liar's loan) the mortgage broker use the income the borrower states on the application form — as opposed to the income the borrower can document.

The lender recognizes that the borrower «could» be taking home more money than the IRS taxes, however, during the housing bubble of the 2000s many brokers used «no doc» loans as a tool to qualify a borrower even though they knew the borrower did not meet income requirements (thus the name «liar's loan» came to be).

In many such cases, the shopper selects not the loan officer with the best posted price but the loan officer who is the biggest liar.