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We have talked about the huge amounts of money coming into the real estate world and the lenders who lent this money to people obviously unqualified to borrow it. But this impassioned paragraph from John McWilliams, a Florida real estate broker, does hit the nail on the head on the worst of the lending abuses.

This brings us to the infamous no-money-down home purchase, which plays a bigger role in this mess than you can believe. What kind of results do you believe will be the case when an inarticulate, uneducated buyer with no money and bad credit enters “Slippery Sam’s Mortgage Company” and signs up for a fraudulent, toxic, liar loan? From 2002 to 2005 it obviously was the way far too many loans were written. When financial institutions see potentially criminal activity in customer transactions, they are required to send a suspicious activity report (SAR) to the Treasury’s Financial Crimes Enforcement Network. From 2000 to 2006, SARs related to mortgage fraud increased by almost 700 percent. Thankfully, most of those mortgage companies and the foolish Realtors who supported their fraudulent activities are no longer associates with the real estate industry. Hopefully, a valuable lesson was learned by all, and the Southwest Florida market can be revived for all the right reasons. via The News-Press

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