Remember when working in a bank’s lending department meant saying “NO” to people fairly often in order to protect the bank from losses that could lead to the bank being in financial jeopardy? People that have spent their careers working at banks in their underwriting departments certainly do.
And that’s what precisely what made many bank employees so shocked when, during our last housing boom, they were told that their job had changed. Now they were never to say “NO”.
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The story then went from a bank not following rules, to something far more insidious… something immoral and certainly illegal.
Margaret introduced me to the man behind the Downey Loan Center’s “success,” a man by the name of Tom Ramirez, the top gun loan officer that was really running the office, if not in name, then certainly as a practical matter. Ramirez, along with his “partner,” Mario Loria, were the undisputed kings of the Downey loan processing office. They and their team were responsible for at least 2,000 loans during Margaret’s tenure at WaMu, which by my calculations would have been something in the neighborhood of half a billion dollars, give or take.
Tom and Mario’s team worked in what was called “Emerging Markets,” meaning that their market was a Community Reinvestment Act type of area… lower income… minorities… loans considered “non-traditional,” with features like being able to just state your income, as oppose to having to establish it by presenting pay check stubs, bank statements and tax returns, as had traditionally been the case when applying for a mortgage loan. Tom’s market had borrowers that Margaret had never heard of before… people that worked as gardeners, but supposedly earned $75,000 a year or more, for example. Many didn’t speak English. Few had much education beyond high school, and not all had even that.
Tom and Mario targeted this type of market because they could do whatever was best for them, and the borrowers would never even know.
The people in these communities are hard working people. Many are first generation immigrants to this country to whom English is the second language they never mastered. They’re people trying to raise a family under difficult circumstances. They sacrifice everything so that they’re children will get an education and one day have a better life than they themselves ever hoped for or had. In most of these families, money is always tight, but love is always free flowing.
These families were hardly a match for the sophisticated operation at Washington Mutual, run by Tom and Mario. These were people that didn’t always trust others easily, but they trusted the bank. I think most of us thought we could trust the bank, for the most part anyway. I mean, a bank wasn’t a used car lot, right?
But as it turned out, it was much worse than any used car lot ever thought about being. WaMu’s Loan Processing Center in Downey was a place that could make your dreams come true for a little while and then look the other way as you lost everything and your life was torn apart. Because WaMu’s Tom and Mario could hand you the keys to the American Dream, while putting you into a spring-loaded adjustable rate mortgage that would soon make your life a living hell.
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http://mandelman.ml-implode.com/2010/04/wamu%E2%80%99s-top-gun-loan-officers-targeted-low-income-minorities-to-rob-the-bank-and-the-nation/
Long article.
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