I am speaking of mortgage lender Quicken Loans and its owner Dan Gilbert. A couple of years ago, when the Gunds shopped the Cleveland Cavaliers around, they couldn't have found a more nefarious buyer than Mr. Gilbert. A fortune quickly amassed from shopping extremely sketchy loans with more caveats than a James Joyce novel blinded folks in both Detroit and Cleveland (oh, to imagine those cities could ever share something in common!). The slick talking Gilbert waltzed into town with his dirty money and bought a legacy. We were dazzled by the potential championship: LaBron, a team behind him and a coach worthy of the lot. The Q underwent millions of dollars in renovations that made it a sparkling palace to the sport, but its hard to imagine all of the glitz and glamor being sponsored with monies derived from loans that have left thousands out in the cold.
I know, I sound like a Populist. Well, in this particular instance I can't really help it. I was one of those who thought it was so incredible to go see the King play at the Q. I, like many others, didn't really think of the consequences of rampant predatory and questionable lending. I, like most others, didn't make the connection between Gilbert, Quicken and the Palace they were building on a foundation of sand. We all lined up for his particular brand of Stone Soup and proceeded to dump all of our good will into the pot. However, just because we once did does not mean we have to continue to do so.
We can all admit we were wrong and note (loudly if possible) that Gilbert and his ilk helped to create this crisis. As I type I'm listening to the news and the elaborate plans that banks and our government (who were both complicit in the creation of this crisis) have come up with to forestall the inevitable. Between the recession (thanks again GWB2, you jackass) and the mortgage crisis, folks in Northern Ohio and the rest of the nation really don’t stand a chance. And lest we think that this isn't a political hot-potato, I have included below the filed lawsuit by the City of Cleveland against a laundry-list of banks and brokers that precipitated this crisis. Note that it does not mention Intuit/Quicken loans or name it as a defendant - it only lists nearly all of the agencies to whom Gilbert's company sold those questionable mortgages. A blow well struck, Mayor Jackson!
This impacts all of us – even those of us who didn’t fall into the refinancing/ARM trap. Have you seen the news stories about Countrywide, Citibank and other financial institutions losing billions because of this crisis? Their fault indeed, but all of that money lost was from mortgages sold to them by mortgage brokers like Quicken. They were legion, one of every corner, but it was the national brokers like Quicken with their omnipresent commercials that berated consumers to take the money while they could out of their equity, or to purchase a home well beyond their means. This is a crisis that will have generational impact – one that has sapped the primary savings vehicle of the American People…home equity.
Much like the Savings & Loan crisis of 20 years ago, we will still be paying the piper for this fiasco for years to come. Let’s all resolve not to forget the lesson this time, and try our best not to hand the tab to our children…or grandchildren. For my part, I am through with Cavaliers basketball until Gilbert passes the team on to another of the super-wealthy looking for a new toy. Hopefully more and more people will get this connection and the King ends up performing his magic act in an empty Q – until his contract is up and he goes to the Lakers anyway…
More information about Quicken Loans here:
Rip-off Report
Quicken's Response to Proposed Federal Limits to Predatory Lending
First-hand Experience with Quicken Loans Practices
Consumer Comments from the FTC.gov Website
Cleveland's Lawsuit against Predatory Lenders
3 comments:
Benzai,
The first rant on Ann Coulter and GWB only earned a 3 out of 10 - the targets were wayyyyy too obvious. But I can see you were just warming up and this rant against Quicken was fairly inspired. It educated my little self, at least, as I never knew Quicken did more than make software. As for the home loan scandal, it was initially hard for us to understand the problem since our ARM lender (the State Employees Credit Union) was so very (even depressingly) clear about rising costs, but apparently not all lenders are into the 'full disclosure' thing. And admittedly, being highly educated with family members who have bought homes or are attorneys does help with the process.
Anyway, keep 'em coming, it is nice to get a thoughtful rant to counter the morning news show drivel.
Your comments are spot on but you missed one thing.
Predatory lending or not, ultimately the problem lies with a public that refused to admit to itself that it was unable to make payments on these purchases. The fact that taxpayers are bailing out not only companies but now private citizens for their collective asshattery just kills me.
What the heck ever happened to personal responsibility in this country? Everybody is playing the victim card now and the interviews concerning the mortgage crisis/ recession are hilarious. Over and over you hear the slackjaws saying "I didn't know that my interest rate could adjust up leading to increases in my mortgage payments! The lender took advantage of me!"
Lose your house due to your own idiocy? Sucks for you dude. Maybe next time you'll do some reading about the ins and outs of home lending instead of watching that next episode of America's Next Top Model. FAIL
{classist quote}
No one in this world has ever lost money by underestimating the intelligence of the great masses of the plain people. Nor has anyone ever lost public office thereby.
H. L. Mencken
{/classist quote}
How was that guys... amidoinitrite?
Matty,
I totally agree with you. In fact, its almost comical how no politician, pundit or banker-type would ever say, "I told you so!" While "caveat emptor" should be the phrase of the day in a free market society, anyone who has taken out a mortgage or significant loan knows how esoteric the process is. The problem I have with Quicken and their ilk is that they worked so damned hard at getting Joe Gullible to sign on the dotted line. Their pressure-laced sales tactics were deliberately targeted at those who were least informed as to the pitfalls of the process. As you aptly point out, there is always money to be made off the ‘regular guy’, but it doesn’t make it kosher to do so.
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