My wife and I have 45 years of military service between her career and mine. By 2005 it was clear to us that executives and many employees in the mortgage and finance sector lacked basic leadership traits and principals know to everyone in the American armed forces.

“Know your Marines and look out for their welfare” was easy for us to understand. Allow me to rephrase the sentence. Know your employees and look out for their welfare. That didn’t happen. Know your customers and look out for their welfare. That didn’t happen either.

Set the example is a clear task. Unfortunately with executive pay so disproportionate to worker pay, an attitude of “Holier than thou” and “Do as I say and not as I do” quickly overrides setting the example.

In a pay-for-performance company one finds many employees willing to sacrifice integrity, dignity, and customer satisfaction for a larger share of the profit. Justifying the results by claiming they are simply perfoming up to expected standards, these employees tie into another leadership failure: Developing a sense of responsibility among your subordinates

By 2007 we knew the economy was in trouble. Mortgage blues effected everyone by late 2009. What was violated? Perhaps it was the basic principle of “Seek responsibility and take responsibility for your actions.”

When any private of PFC with 12 weeks of military service could see the problem, it is a shame that President Bush, regulators, and others could not.

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Should the government investigate current conditions? Will a free economy poison itself, and the rest of the world, as it did with subprime mortgages? Are banks and institutional investors trying to recap $385 Billion dollars (USD) in collaterized debt obligation losses? These questions and many more are being discussed at Crazy Speculators (www.crazyspeculators.com) and we think it is important. The truth is some of the major players that ruined subprime and Alt-A are the same major players driving up everything from oil and gasoline to cotton and corn.

“Let others hear your voice by signing our petition against wreckless economic policies” the web site says. After what happened in subprime markets, and the worldwide contamination of collateralized debt obligations we support their initiative. As we previously reported, loopholes allow investment banks to operate in specific markets with impunity. Regulators were slow to awaken to subprime abuses. Let us hope that those who regulate the markets are not as slow.

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While Treasury Secretary Henry Paulson was speaking, a federal appeals court shut the door to state enforcement of federally charted banks. Now Paulson wants help from the states. What in the world is going on? Didn’t the court render the states powerless to seek documents and enforce predatory lending laws, while Paulson is asking stes for help after the fact? First we blame poor people, then we take no action at the federal level, and now this? American’s are not that stupid and gullible!

Paulson proposed state and local governments should temporarily be allowed to issue tax-exempt bonds to include money for mortgage refinancings. “Given the local nature of housing markets, state and local solutions can be particularly effective,” the secretary said.

A federal appeals court on Tuesday upheld a lower courts 2005 decision that barred the New York attorney generals office from subpoenaing documents and instituting enforcement actions against national banks as part of an investigation into lending practices. In an order Tuesday, the 2nd Circuit Court of Appeals affirmed a decision that the New York attorney generals office had infringed on the Office of the Comptroller of the Currencys role in supervising national banks under the National Bank Act with a probe into possible racially discriminatory practices in residential lending.

The OCC filed a lawsuit against the attorney generals office in June 2005, saying the investigation infringed on its regulatory role. In the lawsuit, the OCC said the attorney generals office had sought public and nonpublic information about the mortgage lending business of four national banks that operate in New York. The banks included units of HSBC Holding PLC, JPMorgan Chase & Co., Wells Fargo & Co. and Citigroup Inc. From 2005 until today the OCC took little regulatory action, if any. The OCC needs to take partial responsibility for letting the subprime crisis spiral out of control.

We are filing this little bit of irony in our “Quotable Quotes” section for the time being.

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If you are concerned about your adjustable rate mortgage or just cleaning up your credit report an issue that you should be aware of is the statute of limitations on old debt. Many people believe they must pay everybody regardless. At the same time some creditors try to get people to renew their debt, primarily because the statute of limitations is about to run out. Be careful when talking to these people on the phone. Any misworded answer to any simple question can restart the debt, throwing the statute of limitations out the window.

One web site with a chart that shows the statute of limitations is Settlement Scams. Their chart details the statute for open ended, written, oral, and promissory contracts, and limitations differ from state to state.

Another nice chart is on the Household – HSBC Watch web site, and it shows you how to collect from debt collectors and creditors if they violate your rights. See their chart on their “Your Money” page. It has legal references, precedent, and reasons why you can sue creditors and bill collectors. If you are cleaning up your credit report and the statute of limitations has run out your debt must be removed. Creditors, if they report your credit history inaccurately, are held responsible. According to Household – HSBC Watch you could sue. Some violations come with a fixed fine, while others are determined by the court.

When you cite the legal references it gives your argument much more credibility. With the help of these two web sites you can do to work on your credit report.

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Boston Federal Reserve Bank president Eric S. Rosengren urged banks to take a second look at subprime borrowers, saying many have improved their credit scores since buying a home. If that is the case banks could step in and help those homeowners. Meanwhile arguments and debates continue as issues are labeled as “bailouts” or “rescues.” It is interesting to note the soundness of Rosengren’s theory – which it is – while contrasting it against new issues of predatory lending.

In our “lawsuits” section we see new predatory lending investigations and suits. Unfortunately these borrowers may not stand a chance of being refinanced by traditional banks. Such is the legacy of predatory lending. Skeptics make a different point, saying the two biggest predatory lenders that paid the biggest fines in the Untied States bear considerable watching. The two are Household International and Ameriquest. Some suggest Ameriquest settled their predatory lending suit so their Chairman could be rewarded for his efforts.

HSBC, headquartered in London, bought Household International in 2003, although complaints continue. President Bush made Ameriquest’s Arnall the ambassador to the Netherlands. Roland E. Arnall of California is Ambassador Extraordinary and Plenipotentiary of the United States of America to the Kingdom of the Netherlands. He was sworn in by Secretary Rice on February 27, 2006. Previously, Ambassador Arnall was Chairman of the Board of Ameriquest Capital Corporation, a privately held financial services company headquartered in Southern California.

So far removed from working class families with adjustable rate mortgages some suggest the government and big banks don’t care about anyone’s home or their mortgage. We report so you can decide. Comments are always welcomed.

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Strange bedfellows are now suing each other. A sure sign that Radian, MGIC, and C-BASS are singing the mortgage blues came to the forefront as a recent news article shows Radian and MGIC feuding like business partners who can’t get along. The two sides have disagreed on whether MGIC is obligated to complete its buyout of Radian, now that their joint interest in a subprime mortgage investor has become all but worthless. MGIC is suing Radian for more information. MGIC and Radian are mortgage insurance companies.

Clearly MGIC and Radian have been issuing the same forward-looking statements. Did the lenders instead of the borrowers insure the loans and investments? Did anyone realize MGIC and Radian are co-owners of C-Bass and Sherman Acquisition? Sherman Acquisition is a debt collector. What is the relationship between mortgage insurance (or lack of it) and debt collection?

What the general public fails to realize is the connection between these two, C-BASS, and debt collectors. When I saw the article about them suing each other I asked if they slid the lawsuit across the hall. MGIC and Radian are competitors in same industry – Mortgage Insurance – and have significant shared investments. Mortgage insurance providers have been hard hit in the last 3 years on lost mortgage insurance premiums paid by borrowers. These losses were caused in part by piggyback loans, which may be called subprime, but are primarily Alt-A loans. High-risk loans can have LPMI (Lender paid mortgage insurance), and more claims may have caused the start of the divorce. Did partner C-BASS make shabby loans while turning to MGIC and Radian to pay insurance on those loans?

We invite you to read the Household – HSBC watch three part series entitled “About Debt” for more insight into the tangled and interwoven world of mortgages, subprime, insurance and debt collectors. You should keep some of these bottom feeders as far away from your finances as humanly possible.

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August 1, 2007 – In New York state, a $100-million refinancing program has been created by the state and the mortgage industry for people on the verge of losing their homes because of risky, adjustable-rate mortgages. Borrowers with adjustablerate loans or terms that require them to pay only the interest due each month will be eligible for new 30- and 40-year fixedrate mortgages under a program administered by the State of New York Mortgage Agency, or SONYMA, Gov. Eliot Spitzer said in a statement. The loan pool is expected to help 500 to 700 families. Act quickly, since at last count there we more ARM’s (adjustable rate mortgages) than that in New York.

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Credit Monitoring reported to our frineds at Household Watch that the average FICO credit score dropped 50 to 90 points when the consumer is reported as “late 30.” You must be able to trust your creditors and never let an account get 30 days late. You should write to the lender and put your account in a ‘disputed’ status if anything looks wrong.

When HSBC reported payments as “late” and was sued and settled under Shea vs Household, the cost of credit soared for many consumers who did nothing wrong. HSBC owned Household International and Retail Services as a wholly owned subsidiary while payments were intentionally credited late. (see more)

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Mortgage brokers have no obligation to get their customers the best deal. Actually, mortgage brokers have an incentive to push customers toward a mortgage with an unnecessarily high rate. That’s because the bank’s payment to the mortgage broker, called a yield spread premium, compensates the broker for the spread between the lowest rate at which the lender will make the loan and the rate the borrower ends up with. In other words, the higher the rate, the more money the broker makes.

The same holds true when buying a car. The dealership finds our what rateis available to the buyer, and makes more money if the dealer can convince the buyer that a higher rate is the best they can do. Add in all the other up’s and extra’s and the dealer is the winner.

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For those inspired by television shows like Flip That House and Property Ladder, where regular people like you and I by a house to make a profit, there are warning signs. Not so much with the Property Ladder show, but more so with the others, please be aware that those people have investors looking for fast returns on a short term investment. Property ladder seems to focus on individuals with a budget, although they may have money or a construction loan.

You must time the market correctly. Unless you buy a home with plenty of potential equity you cannot accomplish your goals in a buyers market. Renters won’t help you at all. And if the house stays on the market and sits empty you still have debts. The process is not as easy as it looks. Even in California, house flipping met with slowdowns and few qualified buyers.

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