One must feed the demand to invest in 'em;
If a borrower's no good,
Then it's best if you would
Not disclose what does not show the best in 'em."
The "reckless" practices of the mortgage origination industry were illuminated in a federal lawsuit filed against Deutsche Bank and its US mortgage lending subsidiary. MortgageIT Inc. was purchased by the German bank in 2007, as it tried to capture more volume in the booming mortgage bond business. The suit alleges that the bank was so eager not to disrupt its mortgage origination flow that it literally locked documentation of underwriting violations in a closet, only to have them "outed" in court when the boom turned to bust. The US government has paid out $386 million in claims on defaulted mortgages, and is liable for $888 million more.
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