How a Loan Becomes a Scam

The deluge of mortgage-fraud cases that is straining law-enforcement agencies now, experts say, could have been prevented if all lenders had followed traditional underwriting standards and been required to report fraudulent activity.

via How a Loan Becomes a Scam.

Chase the link for a nice graphic explanation of how a loan becomes a scam. I doubt if anyone will ever know how much of the housing crisis was due to fraud, how much was due to negligence, or how much was due to government meddling. I’d like to think that everyone has been duly chastened and will exercise more care in the future, but I somehow doubt it.

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