As you’ve probably already heard, JPMorgan Chase snatched up all the profitable portions of Seattle based Washington Mutual for a slick $1.9 Billion.
Not bad when you look back a couple weeks ago and remember that they had previously offered $8 Billion for the whole kit and kaboodle and were told to take a hike.
And yes, that means the unprofitable remnants of WaMu belong to you, me, and the FDIC.
I may have just a bit of an idea as to how this happened
1 Family + 43 Mortgages = $2.7 M in likely lender losses since 2007
Since 2007, one California family reportedly bought and sold 43 properties with the help of at least 43 mortgages from Washington Mutual that added up to a total of nearly $25 million.
Now, the lender is likely to take a $2.7 million bath on six problem properties among the 43 transactions concerning Vijay and Supriti Soni and other family members, reports the Orange County Register.
Among them is a Santa Ana home for which the couple paid $440,000 in July 2007, before reselling it five weeks later for $660,000 to their family gardener and handyman, the newspaper recounts. WaMu financed both transactions and in July 2008 foreclosed on the home which, according to the trustee’s deed, is worth $220,000 less than the mortgage balance.
An investigation reportedly is ongoing into the situation. WaMu, like many other lenders, apparently did not focus before issuing the mortgages on potential red flags, including a resale, or “flip,” of a property within 90 days of purchase, and the parties’ criminal background, the newspaper writes. “The Sonis had been convicted in 2003 of numerous felonies for a real-estate-fraud scheme. WaMu checks criminal backgrounds of loan originators, such as outside mortgage brokers, but not borrowers.”
It is as though they were begging to be ripped off. I would be curious to see how many more examples like this there are, though I’m sure we’ll never know.
And if the LameStreamMedia doesn’t get off their asses and report on this story, America won’t won’t know that the guys who started the StupidBalltm rolling are the same ones who are currently arguing with the House Republicans over how to give as many deadbeats your future tax dollars.
And don’t forget that the (now) ex-president (for 17 days) of Wa-Mu walks away with 20 mil.
Not that it makes much difference, since we’re talking millions of dollars here, but he only gets $7.5 Million.
The other $11.6 Million is a severance that he is “eligible” for, but in the wake of anger that is coming across the country, I think he would be a fool to accept.
Total those two together and whomever told you the $20 Million figure was off my $900K.
But like I said, since we’re talking Millions, it doesn’t matter too awful much.
“Belongs to you me and the FDIC”. Well, no, they belong to JPmorgan, who as a private company fronted the money to buy the left overs, thats why the FDIC let them buy it to keep it out of governemnt hands. If the FDIC had moved in and taken it, it would belong to you and me. The FDIC called JPM and left them take it. It belongs to them now. Sorry