Saw this press release today, from American Guardian Home Loans, a wholesale mortgage lender specializing in Alt-A and subprime lending in 10 states. Too rich not to share here:
Corrupt brokers are falsifying appraisals, property information and borrower tax returns, bank statements, pay stubs and W2 forms ... so American Guardian Home Loans is starting a movement to stop this criminal activity ... American Guardian Home Loans is one lender fighting back to protect broker reputations and to help bring back loan programs that genuine subprime borrowers need to obtain in order to meet their needs. "We conduct business in 10 states and so far not one of our legitimate borrowers has defaulted on their loan," said Kamran Khosravi, president of American Guardian Home Loans. "What we have experienced are brokers committing fraud and borrowers defaulting on those loans...."
Notice the subtle positioning: it's "their" borrower, yet they want us to believe it isn't "their" loan that's in question here. Just listen to Khosravi, apparently caught on a serious roll while the press release was being written:
"We are not going to give up as some lenders do," said Khosravi. "We will manage every single case of fraud committed against American Guardian Home Loans. We have successfully tracked down all of the fraudulent brokers so far. Each has repurchased their loans in full, refinanced or is in the process of either."
The implied message here is that American Guardian is one of the only lenders in the nation willing to stand up and push back against the fradulent loans it finds on its books. Other lenders, apparently, are content sit idly by and let fraudulent loans eat away at their bottom lines. The best part? The company essentially admits it hasn't been doing all it could have to screen the brokers it accepts loans from:
In addition to working with authorities in managing the current fraud, American Guardian Home Loans has instilled new prevention processes. The broker department is conducting more research on brokers before approving them as an American Guardian Approved Broker.
Those who read HW know that I have my problems with the broker lobby -- there are more than a few corrupt brokers out there, after all -- but a lender taking a holier-than-thou stance regarding its own brokers, having the gall to state that every foreclosure on its books is because of broker-initiated fraud, and then admitting in the same breath that it didn't do all it could to screen its brokers? Now that's a sign of the times.