Faces Of Foreclosure: The Former Police Officer

Our sister publication, Consumer Reports, put together some video interviews with people who, for one reason or another, are facing foreclosure. They are the human side of this financial meltdown.

Today meet Langdon McAlpin, a former police officer who presented his mortgage broker with a letter explaining that he had a traumatic brain injury and may not be able to fully understand any documents he was asked to sign. Mr. McAlpin and his wife ended up refinancing with ARM that had an initial payment of 60% of their monthly income and are fighting to stay in their home of 19 years.

If you’re having trouble paying your mortgage, the Federal Housing Administration may be able to help. Contact them at 1-800-CALL-FHA, 1-800-225-5342.

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  1. IT-Chick says:

    This is sad, and hopefully it makes some of the uncaring people here see what has happened to REAL people.

    Was it this guy’s fault, partially. He should have had a lawyer, sure. But it’s assholes out there that take advantage of people like him. People put their trust in others, to believe that there are good people who would help them.

    People say it’s greed, and sure, there may be investors out there who bought more house than they could afford, but the more light that comes to this, we see more and more people like the McAlpins and it’s just sad. It makes me angry and it’s a shame that our tax dollars used to help in situations like this went else where, to someone’s cushy office. It really shows what America has turned into.
    I don’t know how these people can sleep at night.

    • sebadoh128 says:

      @IT-Chick:

      They sleep on a bed of money, bathe in the tears of children and floss with the bone marrow of the elderly…

      Now that we are done demonizing the demons can we try to fix the problem?

    • varro says:

      @IT-Chick: Jay Sherman: “How can you sleep at night?”
      Rainier Wolfcastle: “On top of a pile of money with many beautiful women.”

    • kaycee says:

      To all of you who don’t have a close family member with a traumatic brain injury:

      This story is ONE example of the kind of thing that TBI survivors and their family members have to deal with. A person’s cognitive abilities are affected by several factors including IQ, attention, memory, reading comprehension, risk discernment, and impulsiveness. Often after a TBI, a person’s IQ is intact, but they have serious problems in one or more other areas. They can seem fairly okay to outsiders, but they are truly impaired.

      There are good reasons why TBI survivors are called “walking wounded,” and why they often live in poverty. Our medical care system has figured out how to keep TBI patients alive, but not how to heal their injury. There are celebrities taking up the cause of many conditions and diseases, but not TBI. Maybe that will change with all the TBI survivors coming back from Iraq.

      Pray it doesn’t happen to you or someone you love.@IT-Chick:

      • thegirls says:

        @kaycee: You are absolutely right, but sadly, that won’t stop asshats from finding a reason to blame the victim and claim to know what they are or aren’t capable of.

      • NYGal81 says:

        @kaycee: My only guess for why it doesn’t get the recognition it deserves is because there is little, currently, to be done for TBI. You can do PT/OT and try to re-establish neural pathways in other parts of the brain to make up for what has been lost, or to regain some kind of function, but that’s about it. Unfortunately, the state of the research on neuron injury at this time is that there are (to my moderate knowledge) no ways to regenerate neuron pathways. Think about Christopher Reeve–it’s the same idea, except his neural injury was in his spinal cord. He backed the hell out of that cause, and we still don’t know how to make neurons grow back.

        Also, I’m not sure it’s true that IQ is “often” spared. If you’re lucky, it’s spared, but even if it is, the associated deficits can make it extremely hard for the injured person to express that aptitude. For example, how do you measure IQ in someone who has a severe memory deficit? If they can’t remember the instructions for the test, they can’t perform the desired action, and the result is meaningless. It might be more fair to say that some domains can be extremely affected, while others are relatively spared. It’s the whole picture, though, that determines IQ–not just one part.

        As someone who frequently works with patients who have TBIs, it’s the one injury I would never want for myself or anyone else I know. I have an incredible amount of empathy and respect for folks that have to live the associated struggles day in and day out.

  2. Anonymous says:

    The McAlpins are certainly sympathetic victims; I have no problem with their efforts to get out from under a bad situation.

    But the McAlpins are not representative of the vast bulk of idiot borrowers who let themselves accept something for nothing (and further, who are as responsible as the banks that made the loans for the destruction of our economy) and now expect people like me, who bought and borrowed within my means, to get them out of debt.

  3. rugman11 says:

    Okay this guy has a legitimate beef. Fraud was committed upon him. There are a lot of stories I don’t think need the sob story treatment–after all, this isn’t the first time in history that people have lost their houses because they lost their job or got sick. But this story is a case of someone who was screwed.

    • wee0x1B says:

      @rugman11: I think there’s enough blame to go around. If he can’t understand the loan docs, why didn’t he get some help? Can his wife make sense of them? And if he can’t find anyone to help, why would he refi in the first place?

      If he knows he can’t make sense of the docs, he’s basically gambling with his house by going it alone. That’s not a very smart thing to do.

      • Eyebrows McGee (now with double the baby!) says:

        @wee0x1B: “If he can’t understand the loan docs, why didn’t he get some help?”

        Honestly? You have to be a certain amount of sophisticated to know when you need help. I used to teach some legal seminars to clergy, and the whole thrust of the seminar was not to teach them the law, but to teach them when they needed to call a lawyer.

        People lacking the sophistication to understand the documents are also often lacking the sophistication to know then need help — or somethings where to find that help.

      • failurate says:

        @wee0x1B: He might have mistaken the person screwing him over as someone who was helping him.

  4. Flame says:

    I think the thing that really bothers me is that fact that this is so wide spread. Most of the time, you hear about isolated cases of people running amok and doing bad things. But this whole mortgage thing seems to me that it was basically the industry norm to do this to people. My question is, what is wrong with humanity as a whole that you can find this many people willing to screw anybody and everybody? Is this really what the human race is all about? Whatever happened to being good people and trying to get along in life without hurting anyone else?

    Possibly, I’m delusional….

    • cynical_bastard says:

      @Flame: Being nice rarely makes you a rich man.

    • mac-phisto says:

      @Flame: it’s not about “right” & “wrong” so much as “where’s my commission check?”

      welcome to capitalism. enjoy your stay.

      • Ingram81 says:

        @mac-phisto: Welcome to greed. Its human nature. You know why socialism will never work? Greed. You know why must violent crimes occur? Greed. Why did this guy get f’ed? Greed.

        It is incorrect to blame capitalism for what happened to this guy. Its pure and total human greed. If you can cure humanity of that, well, then you’ve done something far better than cure cancer.

        • thisotherguy says:

          @Ingram81: Doesn’t capitalism thrive on greed? Doesn’t it also create a breeding ground for more greed?

          How can you say this isn’t the fault of capitalism?

          • Ingram81 says:

            @thisotherguy: Your statement just really made my head hurt.

            If a bacteria exists, and then you add sugar water, and the bacteria grows, its the sugar water’s fault the bacteria was there in the first place?

            You sir have just completely opened my eyes to a whole new level of science and logic.

        • mac-phisto says:

          @Ingram81: you can’t cure it, but you can control it. that’s what government is all about. “providing for the common good”. the common good =/= everybody out on their ass b/c a bunch of knowledgeable businesspeople decided to play pig-in-a-poke with american homes.

          you want to talk “redistribution of wealth”? this is probably one of the greatest redistributions in the history of our nation – bankers sapped trillions in equity out of american homeowners & when faced with the repercussions, let the taxpayers foot the bill.

    • shepd says:

      @Flame:

      Well, think about it. Society is at a point where, for many, income is so terrible many can’t afford to eat, clothe or shelter themselves. This has been ongoing for years, don’t think it’s right now.

      When you give someone with a high school diploma whose best prospects in life are living in a craptastic apartment eating whatever is on sale, and buying clothes from the goodwill an opportunity to make a lot of money and the only thing that will lay on their conscience is that they will be taking money from people with enough of it they were actually able to get together a downpayment, what the hell do you think will happen?

      These people are the same people that work as telemarketers, rent-to-own salesmen, etc. They have a choice between self-pride and working for $8 an hour at Walmart, or working for $16 an hour scamming the “rich”. And, trust me, to someone on minimum wage, $1700+ a month looks like absolute pure GOLD rich.

      We could start paying fairly for work, but that ain’t gonna happen. Because people who make a decent amount of money are greedy and don’t want to pay enough that people working at the bottom of the chain can afford the basics of living.

      The greed isn’t with the people at the bottom of the chain. It’s with the people earning a decent wage that don’t want to pay for anything.

      • Ingram81 says:

        @shepd: Because the people in the middle of the chain want to have a life like those at the top of the chain, and worked their ass off to get to the middle of the chain from the bottom of the chain.

        I don’t blame them for not wanting to give up all that they worked hard for just to make everyone else “equal”.
        Equal is fine with me as long as someone else is paying to pull me up to be equal with them.

  5. Trencher93 says:

    Very typical media pattern – the NY Times does this all the time – writes a story around anecdotal experience, and throws a few facts in the middle. The anecdotes, usually extreme cases, are atypical. Most people knew exactly what they were signing. If the man was a vegetable in the mortgage broker’s office, he sure doesn’t have any problems talking to the media. So he is being exploited, or what?

    • Shadowfire says:

      @Trencher93: If he has a head injury, and is legitimately considered disabled, the contract is not valid. There can be no mutual assent.

    • IT-Chick says:

      @Trencher93:
      He didn’t say he was a vegetable in the office, but that he didn’t understand and was confused. He asked questions and received bad answers. He’s not allowed to speak out, or you’re saying he should be too mentally challenged to speak out. Perhaps he has children that pushed him to speak out.

      • Ingram81 says:

        @IT-Chick: “he didn’t understand and was confused. He asked questions and received bad answers.”

        If you don’t know or understand what you are agreeing to, how about you don’t agree to it? I might be tempted to use this very same tactic to get my fixed rate mortgage lowered then, saying that I was confused and didn’t understand what fixed rate was and was told that the rate would lower each year that I stayed in the house. And all I would need to do is get some members here to agree that I was mentally incompetent (which wouldn’t be a difficult task) and voila!

        • thezone says:

          @Ingram81: I think your tactic would only work if some of the members here were trained medical experts like this man’s primary care physician. People with cognitive deficiencies don’t always make good decisions. I don’t understand why this is such a difficult concept for some people to understand. This isn’t a person with less of an education. This is someone with a brain injury. Why are you so quick to blame him.

          • Ingram81 says:

            @thezone: No statement I made referred to his education at all. If it is as you say people with cognitive deficiencies don’t always make good decisions then he shouldn’t be making any decisions that are legal and binding without someone with power of attorney there.

            Also hopefully then, he didn’t drive himself to the closing. Because a cognitive deficiency would tend to cause people to make impaired judgments. And impaired judgment making while operating an automobile is a felony.

            Or is it a case where he can cherry pick when he has his cognitive issues?

            • thezone says:

              @Ingram81: So let me get this right. A person with a cognitive disability is supposed to have the judgment to know that they shouldn’t be making judgments? If they had that ability then they would not be cognitively deficient. At least twice you have made a joke that maybe you should use this as a defense. It is not fair to compare a fully capable person’s decisions with those of someone who has suffered a brain injury.

              Second, do you have any proof that he drove himself anywhere? He also may not be so impaired that he cannot operate a motor vehicle. Implying he is “cherry” picking his cognitive issues without a shred of proof is wrong.

              • Ingram81 says:

                @thezone: It is not wrong. If you can make decisions that can result in people freaking dying (driving a vehicle, operating machinery, etc) then you have the capability to read a document. I mean last time I checked, you had to be able to read to be able to drive. Maybe that’s changed, but you had to pass a test which involved words and comprehension to get a license last time I did it.

                Yes if the Doctor says “Hey you have a brain injury which prevents you from making rational thought out decisions” and then you put yourself into a situation to have to make a decision, then yes its your fault what happens to you. Either this man should be a vegetable and have every aspect of his life decided for him, or he is capable of making decisions. Which is it? I mean hell if he cant make decisions on his own, then he needs to be supervised. Because the doctor gave him a note saying that he has cognitive issues doesn’t mean that he can go out and start shooting people and get away with it?

                • thezone says:

                  @Ingram81:

                  1. Having the capability to read a document and having the ability to understand the document are two completely different things.

                  2. In most states you can drive a car below the age in which you can enter into a legal agreement. Therefore, it is safe to say that driving a car responsibly is not a good litmus test for having the ability to sign a legal document.

                  3. I didn’t notice the scene where he is driving a car down the street. So he is not cherry picking what he is doing.

                  4. I go back to my original argument, which you fail to answer. If you have a cognitive disability how are you supposed to know that you are not able to make the decision. That is why you are disabled.

                  People with disabilities are not vegetables like you are stating. Not every aspect of their life should be decided for them. They need additional assistance (which is often difficult for them to receive) in order to make informed decisions. A power of attorney would be helpful for someone in his situation.

                  5. You keep bringing up arguments that have nothing to do with this man’s situation. Who has been shot? I never implied that he can go out and shoot people. Shooting people has nothing to do with this conversation. Please try to stay on topic. Please don’t bring up him flying a plane or running for public office or any other thing that he shouldn’t possibly do depending on his level of cognition.

                  • Ingram81 says:

                    @thezone:

                    1.) If you can read the document, and you don’t understand the document, don’t sign the document. Pretty simple.

                    2.) Driving a car responsibly requires the ability to make cognitive decisions. If he is not able to make cognitive decisions and be held accountable for them, I am simply stating that he should not be allowed to drive either.

                    3.) See above. IF he’s driving around and making cognitive decisions, like not running people over, than it might be safe to say he is cherry picking when he has cognitive capabilities and when he doesn’t. I concur there was no video of the individual driving ANYWHERE. However, just because there isn’t video doesn’t mean that he doesn’t do it.

                    4.) Your statement that “If you have a cognitive disability how are you supposed to know that you are not able to make the decision.” means that you believe the doctor didn’t explain to him what that entails or that his brain cannot understand the words that are coming out of the doctors mouth. So I doubt the doctor didn’t tell him what that meant so we can debate the second option. If he couldn’t understand what the doctor was telling him then surely things like ballooning payments and ARM would’ve caused him to figuratively crap his pants. I mean good god the legal mumbo jumbo at my closing was enough to make me have a triple scotch afterward. My point is when he was confused or didn’t know what he was signing, he shouldn’t have signed it. I believe you are stating that how was he supposed to know not to sign something that he didn’t know what he was agreeing to. Please explain to me at what point you knew that he didn’t know that he shouldn’t be signing something he didn’t know about. Cognitive disability is a very gray terminology regarding comprehension. I concur that if he was unable to make decisions, someone with POA should have been present, but that doesn’t necessarily make the contract null and void.

                    I was not inferring that all people with disabilities are mindless vegetables. I do believe that if you aren’t able to take care of yourself, than you do unfortunately have to give up certain aspects of decision making.

                    5.) I’m sorry. I have a cognitive disability. Nothing I said before this counts.

        • NYGal81 says:

          @Ingram81: Word. This guy has some special circumstances that the vast majority of people who signed bad mortgages can’t claim. Now, I’m not a lawyer, but couldn’t he have signed a power of attorney to allow someone else he trusted to represent him in the purchase of the house? Would that have solved this problem from the start? I don’t know…just a thought.

          Although the scammy mortgage brokers are heavily culpable in this, I am not one to totally remove blame from every single person who signed a mortgage and didn’t know what they were getting into. You can’t control scammy brokers, but you sure as shit can control whether you educate yourself and whether you sign on the dotted line. You are signing a mortgage, folks. It’s a contract. It’s probably the largest financial obligation many of us will ever have. It spells out your obligation in very fine detail. If you don’t know how to decipher what’s going on, get yourself a real-estate lawyer, and let them help you. If you still don’t know what you’re doing, maybe you shouldn’t be buying a house.

          • Ingram81 says:

            @NYGal81: “I don’t know…just a thought.” That’s the crux of the problem here (I mean both in this sad, sordid tale, and nationally) that no one thinks.

            Silly you, thinking again. That’s just plain dangerous.

        • IT-Chick says:

          @Ingram81:

          Hindsight is really a wonderful thing. I am tempted to think that older people may be more trusting, not realizing what scum is truly out there ready to take their money, but this man is an ex-cop, so surely he has dealt with some scumbags. I’m sure there are millions of stories of people who were deceived and going through this. It’s so easy to say they deserve it, that they’re stupid. The unfortunate thing is these people know how to buy a house, they’re refinancing, so they have done it before and managed to do it right, yet they were deceived the second time. If this wasn’t on such a massive scale I think we would be more inclined to feel sorry for these people. Bailouts caused by this are affecting everyone’s pocket book, or will be. It’s difficult to understand why you would sign something putting your trust and faith into another person thinking they wouldn’t screw you. I have trouble figuring why the hell I would do that myself. What we’re left with is broken hearts, broken homes, and in my case, broken families.

    • mac-phisto says:

      @Trencher93: sure, it’s anecdotal – the media loves that crap. but here’s the truth about the industry: brokers were making more money approving borrowers for exotic loans than they were booking traditional loans. there were incentives built into these products to sell borrowers worse products than they qualified for. ARM instead of fixed rate = $$$. a half-point increase in the teaser rate = $$$. tacking on a pre-payment penalty = $$$. selling a portion of the loan as a HELOC = $$$. add on the opportunity to refi the loan in 2-3 years & rake in another round of commission & you have a recipe for deception.

      when all your incentives are built around selling the consumer a worse deal, how can you honestly expect that the industry isn’t going to be infested with cheats & cons?

    • thezone says:

      @Trencher93: Where is your proof that most people knew what they were signing? You don’t even have anecdotal evidence that most homeowners knew the risks. Also, the man never said he was a vegetable. He said he had a traumatic brain injury that has lowered his cognitive skills. Stop blaming the majority of Americans who took out loans they thought the could afford. The vast majority of people didn’t see this coming.

      • Ingram81 says:

        @thezone: If I knew where this was going Id never bought my house either. Ive lost something like 5% of the value since last year. Good god I musta had a brain toomer at the time I signed the documents…der der der.

        Jesus Christ, yeah he got taken advantage of. Yeah it sucks and its an unfortunate situation he is in right now. If he was mentally incompetent then, is he not now, cause I mean that’s one hell of a doctors excuse if I’ve ever heard of one. Presenting a letter saying he was mentally weak to ANYONE that makes a commission off a sale is like wearing a suit of fish heads into a shark tank. Or like walking onto a firing range with a bulls eye glued to your shirt. Or going to a used car lot with a sign saying really rich town idiot. If you know that you are medically mentally incompetent do you think you should be signing contracts all on your own? Are you so naive to think that an individual that makes his income based upon how bad of a mortgage you take out is going to have your best interest at heart? Please dear God don’t tell me that we have gotten to a point in this country where we not only need to be protected from others, but protected from ourselves.

        If you don’t know what you’re agreeing to (or who you happen to be nominating for a public office ) how about don’t do it.

    • Trai_Dep says:

      @Trencher93: I suspect it’s because, in the cases that aren’t so abjectly fraudulent, Freeper types would nitpick how it’s all the borrower’s fault and that corporations (and Barney Frank) are to blame.
      Thanks tho: now we can add “it’s anecdotal!” to the exculpatory list.

      Not, of course, to suggest that some borrowers weren’t scamming or stupid. But I’d think it’s the industry’s freaken JOB to reject these applicants.

      • Trai_Dep says:

        @Trai_Dep: Err, “and that corporations aren’t culpable (and…”

      • Ingram81 says:

        @Trai_Dep: If you come to me and place a document in front of you saying something crazy, like Ill own your soul and your first born, and every time you take a leak, you have to sing the theme song to Titanic, and while you may not understand what you are signing, sign it regardless, I shouldn’t be allowed to hold you to that agreement? That is the whole functional reason of a contract. There are terms listed and that by signing the document you understand what those terms are and also agree to it. If I tell you that the terms are you get a fuzzy bunny on your birthday, and you don’t read the contract, just take my verbal word on it (depending on the state), you are still on the hook to sing me some Celine Dion. You may not like it in hind sight, but then again, you should have read what you were legally agreeing to. If you are/were incapable of understanding the agreement, you should voice that reason at the closing, and REFUSE to sign the document until you have your own legal counsel available, so they could keep you from having to give me your soul. If you cant think about this before hand, then you shouldn’t be going to a house closing, and you definitely shouldn’t be putting my life in danger by driving to a closing.

    • Fresh-Fest-1986 says:

      @Trencher93: The thing that always gets me about cold hearted statements like this are how quickly they change once the scene involves someone you know or love. Let this man be your grandfather or spouses parents and I guarantee your tune would change.

      Sometimes in situations involving large institutions people get screwed. Other times blame can be layed at the feet of the individual.

  6. Psychosocial says:

    So between both of them they didn’t know what am ARM loan was eh? I call bs. If you’re brain damaged and can’t sign a contract, pay a lawyer $150 to look it over and explain it to you. I don’t feel sorry for them. Stupidity is a major problem in this country, and these people acted stupidly. It is what it is. Banks have always been predatory lenders, this is nothing new.

  7. Pixelantes Anonymous says:

    The report should’ve included their mortgage broker’s name and home address.

  8. jtheletter says:

    This man was taken advantage of and that’s the major issue here, I have no sympathy for the broker and hope he gets hit with some sort of suit or penalty for this.
    That said, there seems to be a breakdown in the buyer’s support in this situation. If it was known that Mr. McAlpin had comprehension issues then why didn’t his wife review the paperwork? Presumably even if she couldn’t sign she could understand the payment schedule and advise her husband. And if the McAlpins took the time to get and provide a doctor’s note then why didn’t they also have the contract reviewed by a lawyer?
    It seems like they prepared for the contract comprehension issue only halfway. What’s the law in this situation? Does giving such a “mental deficiency” note to the broker require him to provide assistance or extra review? Again, I’m NOT siding with the broker here, but what was the broker’s legal responsibility, i.e. what safeguards should be/are in place to prevent this sort of abuse (besides overhauling the whole mortgage system) in the future?

    • Ingram81 says:

      @jtheletter: That would require personal responsibility. And if you haven’t checked, we are COMPLETELY bankrupt of that in this country.

    • NYGal81 says:

      @jtheletter: I wish I had read your post before replying above. I was thinking the same thing! If he KNOWS he has a legitimate disability that prevents you from making a sound decision, couldn’t a power of attorney been secured to allow someone else to represent him in this matter? I mean, really? Legal contracts are hard enough to decipher for people who aren’t disabled. That might be why there’s a whole branch of law that deals in real-estate matters. People specialize in this!! I’m not sticking up for the broker either. He had a moral obligation not to take advantage of the guy, but does the “doctor’s note” obligate him to do anything else? I don’t know about that.

      You’re absolutely right…the family had the sense to get this note secured and plan for that portion of it, so why did they not think that maybe consulting a lawyer or other trusted, knowledgeable party might be a good idea? I don’t know about this…I feel plenty bad for the guy, but I just don’t know what his note was supposed to provide for him.

  9. thezone says:

    Here is another example of our flawed health care system. The only reason he had to take an ARM was medical bills that should have been paid for. No one should have to choose between a home and being alive. When will we see that one way or another we pay for our overpriced system. We need to show more of these stories so more people will wake up.

    • Coopon says:

      @thezone:

      I thought he said they took the loan to fix up the house not medical bills.

      Although I agree that medical bills are a problem, when I worked at Equifax most of the bankruptcies I saw also had unpaid medical bills on them.

    • wee0x1B says:

      @thezone: No, he said they wanted to refi to do some work on their house. He said his credit was bad because of medical bills. I find that hard to believe because he said he was injured at work. The state has plenty of coverage for its workers and workplace injuries so his out of pocket medical bills ought to be pretty low.

      And again: Who goes into a mortgage place knowing he can’t understand the stuff he’s going to sign? Why not get help? I mean, he KNOWS he can’t make sense of the docs, so he’s gambling his house.

      I suspect there’s more to this story than what’s in that video. I’d be curious to see where they spent the money they pulled out of their home.

      • thezone says:

        @wee0x1B: My point is that his credit wouldn’t have been bad if his medical bills had been paid. There are many Americans with the same problem. Their credit rating is poor due to medical bills not credit card bills. If he had not had bad credit then it is much less likely that he would have had to get an ARM. That was my main point. Sorry if I was not clear.

  10. Anonymous says:

    I do feel bad for him and his wife, it’s a real shame if they lose their house. They probably have a legal case if he’s legitimately considered non-competent (although I somehow doubt if he truly is) If his wife was on the loan, I’d imagine they’re probably jointly and severally responsible anyway – even if he personally isn’t.

    But a few things bother me – he *knew* he was getting an adjustable rate mortgage, because he said he insisted on a fixed rate one but told that it wasn’t available to him. (Because of their credit? A lie by the broker? Who knows?) He obviously needed the money because of his doctor and other bills, as he had stated. So he was trying to tap the equity in his home, and it’s unknown how much he did cash out and spend for bills. He obviously asked questions, and if he didn’t like the answers and he did it anyway, where does the blame lie?

    The greed goes both ways – homeowners trying to tap into equity while assuming unsustainable rates of return, as well as mortgage brokers that are selling you products that are most profitable to them. There are those brokers that perpetrate out and out fraud, but trying to convince you that you can afford something you can’t doesn’t necessarily cross that line. Morally ambiguous no doubt, but not illegal.

    Ultimately, people should be responsible for the things they sign and agree to. The homeowner got something out of the deal – a good chunk of equity cashed out, probably, or some other financial relief. There is no such thing as a free lunch, and the only person that’s going to look out for your own interests is yourself.

  11. ChibaCityCowboy says:

    You’d think Bill would be doing pretty good with all the copies of Left4Dead that sold….

  12. kwsventures says:

    Does a day go by that I don’t hear these tear jerker stories? Failure is part of life folks. Every decision you make is your responsibility. I am still waiting for the story that some mortgage broker put a gun to a consumer’s head and forced him to take a loan he could not afford. Well, I am waiting. In this guy’s case, he needs to rent a place. He can’t afford to own a property at this point.

  13. gStein_*|bringing starpipe back|* says:

    so, if you’re now calling Consumer Reports your sister publication, what would that make the gawker-blogs? ex-sister publications?
    what do you call “daddy sold me into slavery but kept his favorite kids” in the real world?

  14. JGKojak says:

    “Does a day go by that I don’t hear these tear jerker stories? Failure is part of life folks. Every decision you make is your responsibility.”

    I am perplexed.

    We have regulations and laws so that the most fraudulent of behavior (listing ingredients on a package) can aid consumers and prevent people from wasting their time. Do YOU believe people should have to ready every line of a 30 page mortgage app, or should their be a reasonable expectation that 1) if the bank is loaning me money, I fit into a profile of a person who can pay this amount, 2) there is nothing in the fine print turning my fixed rate into an ARM, 3) I know exactly what could happen to my ARM in the future.

    Bottom line- interest-only loand and ARMS should be illegal for the home mortagage market, period. That solves LOTSA problems.

    • Anonymous says:

      @JGKojak: You don’t have to read the entire 30 page mortgage paper to find out the terms of the note – just the first page. If what is listed inside the doc is different than the outlined terms of the note on the 1st page, it’s fraud.

      But otherwise, I do recommend everyone read absolutely everything presented to you to sign. I did, and you should have seen the look on the bank’s closing attorney’s face when he realized he’d be missing his tee time.

  15. Anonymous says:

    I don’t want to play blame the victim, but the fact of the matter is that Mr. McAlpin did not act alone after being duped by a shady mortgage broker. Does the wife also have a traumatic brain injury? If not,why did *she* not insist on getting competing offers/having a lawyer review the paperwork/refuse to sign any refi offer that was not exactly to their liking?

    Also, the notion that this was some sort of high-pressure, do-or-die situation rings false. Per this interview, the McAlpins pursued this refi because they “wanted to have some work done” on their house. Meaning, they had time to shop and compare and consider different loans.

    Having the luxury of time, complete control over the size and scope of their intended fund expenditures and at least one spouse whose cognitive abilities were unimpaired kinda takes the teeth out of the tale of an evil mortgage industry destroying lives.

  16. jimmy37 says:

    I am confused here. If this guy was so disabled, why did his wife sign anything without anyone else around to explain things to her? Fraud is despicable, but so is stupidity.

    • Leksi Wit says:

      @jimmy37: This all comes down to the age old problem of marriage where one person (usually the man) handles the finances, and the other remains blissfully ignorant. The McAlpins should have had help from either a financially savvy friend, or dished out for an attorney (though that may have been quite difficult on their income of just over $1700/mth). I do think they should not have trusted the loan officer, but that is the saddest part. Lack of savvy aside, a dirty loan officer is quite despicable! The McAlpins should engage in a letter writing campaign to that person’s company, and see if that person can be in the very least fired.

  17. jcargill says:

    Behold the glory of lassez faire capitalism!