Banks Hired "Burger King Kids" To Process Mortgages

JPMorgan & Chase had a cute name, the “Burger King Kids,” for the workers with little no experience or qualifications it hired to process the reams of mortgages it plowed through at the height of the housing bubble. These walk-in hires “barely knew what a mortgage was,” writes the NYT. The newbies Citigroup and GMAC/Ally Bank outsourced the work to sometimes tossed paperwork into the garbage can.


Almost overnight, what had been a factorylike business that relied on workers with high school educations to process monthly payments needed to come up with a custom-made operation that could solve the problems of individual homeowners. Gregory Hebner, the president of the MOS Group, a California loan modification company that works closely with service companies, likened it to transforming McDonald’s into a gourmet eatery. “You are already in chase mode, and you never catch up,” he said.

It’s like opening up the sausage casing and seeing all the gristle and sawdust pour out. And there’s entire cities of warehouses full of ’em.

Bankers Ignored Signs of Trouble on Foreclosures [NYT via @ronlieber]


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  1. Alvis says:

    Oh, Burger King Kids Club, you taught me so much about diversity…

  2. Loias supports harsher punishments against corporations says:

    I blame the homeowners. Yeah, that’s right. The homeowner is to blame for bank fraud and bank incompetence.

    You want evidence, you say? A logical argument, you say? Sorry, I don’t have ’em. But it’s still true.

    • danmac says:

      1. Yeah! Those “homeowners” should have known that they would lose their jobs when the economy collapsed 2 years after they purchased their $500K homes.

      2. They also should have known that the real estate market would collapse and that their property would lose so much in value that they have no choice but to walk away! I mean, in hindsight, it was clearly inevitable.

      3. How dare they walk away from an obligation they made!

      • Loias supports harsher punishments against corporations says:

        Testify! Preach on, brother!

      • hypnotik_jello says:

        They should also have known that the banks would have created Mortgage Backed Securities and Collatoralized Debt Obligations. They further should have known that the banks using Credit Swap agreements to hedge against default would nearly wipe out AIG. Yeah!

        Homeowners should have known better!

        • danmac says:

          Listen, when I buy a horse, I check the teeth. When I buy a car, I kick the tires. When I buy a home, I extensively research investment practices of the banking and mortgage industries, as well as the subprime, Alt-A, collateralized debt obligation (CDO), credit, hedge fund, and foreign bank markets.

          I mean, I’m just saying. Fool me zero times, shame on you. Fool me once, shame on me.

      • s73v3r says:


      • TasteyCat says:

        At the very least, the homeowners should have known they were buying homes they couldn’t afford. Sure, there are people who were impacted by the economy, but there were also people who were willing to sign a mortgage with any terms, no matter how ludicrous, just for the sake of being able to say they own a home.

    • Powerlurker says:

      I blame the media blamers.

  3. YorkBiblos says:

    The Burger King Kids?? Now THIS is a blast from Gen Y past.

  4. discounteggroll says:

    thats some serious old-skool memoirs right there.

    • 3skr1mad0r says:

      Wasn’t there a big PC stink about the kid named “Wheels” ?
      Looks like the same artistic type as those who did the Carebears Movie.

  5. blinky says:

    Why aren’t they going after the banks for perjury?

    • Bohemian says:

      Wouldn’t this amount to fraud? If the banks were having incompetent workers just sign whatever without even looking at it and sending it to the courts knowing it was likely junk an inaccurate?

      • Powerlurker says:

        It would likely be perjury charges for the people who physically signed the papers and subornation of perjury charges for their bosses.

        • ARP says:

          Not so sure about the subornation because their offical policy was that they must carefully review the documents. They’re argue that if these processors didn’t understand something, they should have asked. Also, all the while their unofficial policy is that you must process 500 foreclosures per day or you’ll be fired and replaced with someone who will.

          It’s cheap and it makes the actual person who committed the perjury/fraud sympathetic.

      • ARP says:

        It would be the people that did the actual signing. It’s quite genious really.

        1) Get people who need jobs and who aren’t too smart to do jobs that are shady/unlawful.
        2) Don’t train them and give them impossible quotas to fullfill, all while maintaining an official policy of checking the documentation for each mortgage.
        3) When the law comes knocking, you have plausible deniability because your OFFICIAL policy was to check each mortgage.
        4) Given our treatment of corporate persons v. real persons, at most you’ll get a fine or slap on the wrist since there is no one person that create this situation.
        5) Since the people that signed the foreclosures are rather sympathetic people, its unlikely that charges will be brought against them, even though technically, they’re the one who did the bad deed.

    • RadarOReally has got the Post-Vacation Blues says:

      Because corporations are only equal entities to humans when they want to buy a politician. When they do something wrong, they’re above the law, and there’s no one person to prosecute.

      No, I’m not bitter at all.

      • econobiker says:

        A+1 for that.

        I wish we could perp walk a corporation by literally locking its doors from the exec offices to lowest intern. Then release the locks from lowest to highest as everyone had to explain their roles in the problem.

  6. KyleOrton says:

    “Gregory Hebner, the president of the MOS Group, a California loan modification company that works closely with service companies, likened it to transforming McDonald’s into a gourmet eatery.”

    I’ve seen this. It’s called Hells Kitchen and blows.

  7. DerangedHermit says:

    When we get done with them, they’ll look like Wheels.

  8. Bativac says:

    You all might be surprised at the number of presumably professional environments that are staffed with people who barely graduated high school. Tech support for example. Or, insurance claims offices. How would you like your insurance claim settled (poorly) by some guy playin’ grab-ass with the girl in the cubicle next to him?

    I can see how this happened in the world of mortgage processing. Another case of corporations looking only at numbers without taking into consideration the actual quality of the work being done.

    • TakingItSeriously is a Technopile says:

      THIS –

      Actual sequential conversations I have witnessed:

      All they need is a Knowledge Base right? And we have one of those! The last support teams who actually knew what they were doing that we RIFed because they made too much money wrote the articles!

      6 months later: You say 90% of the KB articles for the product are wrong? Have the support people write new ones! What do you mean they don’t have the education to write the articles or troubleshoot the product on their own?!

      • Bativac says:

        Yeah! At AOL I think it was called Switft Response or something. That was a long time ago, though.

        Nowadays, in my industry, I overhear things like “sir, I’m not gonna explain to you why it’s not covered. All I know is, it isn’t covered.”

        They don’t know what they’re doing but BOY do their numbers look great!

        • Thyme for an edit button says:

          It’s like one of my student loan companies. “I don’t know why you don’t qualify for a forbearance, but that’s what the computer says.” When I asked why the computer would say that, of course the rep did not know. It turns out they had already applied a forbearance so I did not need to ask for one anyway. I guess the computer didn’t tell her that.

          The other lender’s reps knew the laws on student loans and why things happened a certain way. It was quite a shocking difference. I was sad they sold my loans to a different company.

    • pecan 3.14159265 says:

      Administrative assistants and secretaries are also staffed by a lot of high school grads, and I think it’s one of the only areas in which people are more likely to assume that you didn’t go to college, rather than that you did. One of my friends used to be an administrative assistant and part of her battle was dealing with people who treated her poorly because she was a low-level employee, coupled with the fact that she didn’t go to college (which was emphasized by the fact that I was in college at the time). I tried to make her feel better about her job, but secretly, I knew that she had to go to college if she was ever going to do anything other than be an administrative assistant.

  9. catastrophegirl chooses not to fly says:

    from the article:
    “When you think about what it costs to add 10,000 people, that is a substantial investment in time and money along with the computers, training and system changes involved.”

    …. but when you think about all the jobs that would have created, it makes you wonder how many people would have been able to pay their mortgages just from BEING EMPLOYED.

    ugh, they just didn’t want to take away from their pockets to add to their overhead and now somehow, the banks don’t think it’s their fault?

  10. Talisker says:

    MOS , I see. You’ll never find a more wretched hive of scum and villainy.

  11. Anonymously says:

    Having worked in the mortgage processing industry, this foreclosure snafu doesn’t surprise me in the least. Demand and margins were so high that they could basically do whatever they want and still turn a huge profit. The software, processes, and training were sorely lacking, and the companies don’t really give a crap. You’d regularly hear stories about mortgages going unfilled, thrown out, left in drawers, etc.

    I’m not sure, but my guess is that the Title Insurance underwriters will be on the hook for the money the banks can’t collect on foreclosure. They’ll be a run on the underwriters and then the government will bail them out too and everyone who doesn’t deserve it will have a free house.

  12. RandomHookup says:

    Because I am old, I have no idea who these people are.

  13. u1itn0w2day says:

    The scary part with all these BK kids or robo processors if indeed they really are that niave or ignorant to the ways of the mortgages,contracts and laws etc is that many of those same processors will assume that’s the way it’s done. They will spread the procedures they learned at these companies to other companies and the employees who will inturn spread and/or infect a new company and batch of employees with this very same crap.

  14. bikerider008 says:

    Of course with all the problems with the MERS system and the fact that banks can no longer prove they actually own the mortgages, maybe there won’t be so many foreclosures. The banks and congress seem to think that’s just a minor technicality, though. Seems the banks breaking laws – fedeal, state, and local is ok.

  15. Cicadymn says:

    Even thought the BKK tried to teach me that gingers were ok. I don’t think it really got through.

  16. webweazel says:

    Wasn’t this one of the reasons about a year back that there was a recommendation of going to court and fighting against a foreclosure. All you had to do was ask to see the original signed note. Since the mortgage paperwork was transferred around so much, and probably lost in the process, if they could not produce the note, you would win against them and keep your house.
    Sounds like it was a legitimate course of action, especially considering the bungling I have been reading about lately. I bet they’re just guessing that most people will just walk away rather than fight, so they can file whatever fraudulent junk they wanted to the courts, and no one would call them on it.

    • econobiker says:

      Problem was not the bogus paperwork itself but the $250/hr lawyers owned by the banks that you had to get the paperwork from in order to probe that the paper work was, in fact, bogus.

  17. econobiker says:

    End all of the issue is that the bank that makes the loan should keep the loan from cradle to grave – whether paid off or delinquent or foreclosed. Same bank, same faces, the entire time…

    • webweazel says:

      This was why we went with Wells Fargo for our current mortgage. Say what you will about them, but they specified up front that they do not resell their mortgages. They keep them from beginning to end. Even though we understand it, getting a mortgage resold in the past just left us feeling somehow “unworthy”, so this was a bonus that pulled them away from the pack.