“I can understand the anger and horrible sense of betrayal these people must have.”

How on earth is this a ‘horrible sense of betrayal’? There are two sides to a contract and the buyers are one side. This is not a friendship, it’s a business deal, that’s all. If I were the buyer, I would think that I’m an idiot. These buyers who do this are indeed idiots, and their behavior trashing the place confirms this even further.

I read another article sometime earlier that a guy let his large pigs run around in his foreclosed home and the pigs totally trashed the place because they were hungry. It is pretty sad that these people are being vandals like this, but I don’t think they care that they are hurting their neighbors since technically they’re moving out.

Many of these people were scammed into buying places they couldn’t afford by unscrupulous lenders. When they discover the truth, of course they feel a horrible sense of betrayal! Are they idiots? I don’t think so….many were non native English speakers or not savvy to homeownership.

This still doesn’t excuse what they are doing to the properties. They need to understand that what they are doing destroys the last vestige of pride they may have left.

“Many of these people were scammed into buying places they couldn’t afford by unscrupulous lenders.”

Well, many were scammed because they let themselves be scammed. Were they scammed because the broker told them real estate never goes down? Or is that being ‘gullible’? Were they scammed because they were told to lie about their income? Or is that ‘fraud’?

“many were non native English speakers or not savvy to homeownership.”

This really doesn’t sit well with me at all. The notion of blaming others for xyz reason. How about some personal responsibility? Instead of blaming others for problems, most of these people should start by looking in the mirror for who to blame.

Not all of these foreclosures were recent purchases by greedhead house flippers. I’ve seen at least three REOs in my neck of the woods where the prior owner had been in the home for decades, sometimes generations, and had simply been talked into a refi or HELOC with an adjustable rate.

Should these relatively unsophisticated, working-class people have asked more sophisticated questions, perhaps consulted with a financial advisor, before agreeing to terms they had no way of meeting? Maybe so. But doesn’t the broker, in these situations, bear the bulk of the responsibility for selling these homeowners something that they plainly couldn’t afford?

I agree - many of these people were talked into their situation by greedy brokers who simply walked away after the deal was done. And some of the “lying about income” was done by brokers in English, when the client only spoke Spanish and couldn’t even read the paperwork. This is especially the situation in East San Jose. I agree that the brokers should bear responsibility, but so far, they have been able to shrug their shoulders and move on with no repercussions.

During lawschool, I used to volunteer at SCU’s “East San Jose Community Law Center” (before it was relocated and renamed). I have worked with many Vietnamese and Spanish speakers who were the victims of predatory lending. Often times, the lenders negotiate with the homeowners in their native language and then draft an English version of the contract with entirely different terms. I think you need to put yourself in these people’s shoes. They’re immigrants with very little understanding of English and probably struggle with langauge discrimination everyday. So when someone comes to their door and appears to be translating these contracts for them, of course they’re going to put their trust in these people.

By the time the homeowners are aware of what happened, the brokers have already received their commission checks and are long gone. While there are laws prohibiting this kind of stuff, I can tell you first-hand that enforcement is next to impossible. Local DA’s offices are told to concentrate on violent crimes (rightfully so) or drug possession (not so right) before white collar crimes.

Honestly, I think that the local governments need allocate more funding toward investigation and prosecution of white collar crimes such as predatory lending (which is a form of fraud)–even if it means diverting some funds from petty drug possession/use crimes.

Are loan brokers and officers required to be licensed? If so, the governing body needs to make the disciplinary records accessible to the public. This would have a strong deterring effect for any misconduct.

I just have to chime in on the language discrimination thing. I don’t have any mortgage experience (currently looking as a first timer to buy) but I have lots of experience with contracts… Being told one thing and then reading it for myself that it’s something else. If it happens to *ME* without a language barrier, I can imagine it is worse for non-native speakers.

I agree - these loan papers are complex! Many people just trust their brokers, which can be a big mistake.