I read all the broker bashing going on . . . how lenders and greedy brokers encouraged borrowers to buy
houses they couldn't afford and sign up for payments they couldn't make and about the bailout programs
states are putting in place to keep people in their homes and I think back to conversations I have had with
borrowers over the last few years.

One in particular comes to mind, my client, a well educated and successful business owner, with great credit
and lots of assets had completed an application for an investor purchase.

Noting the $20K a month figure he had put in the salary block, with his hand,  I asked "Did your income tax
return last year show $240,000 in taxable income?"

"No" he said, somewhat indignant.

"Well, was your gross income before deductions $240,000?"

"No," he says, getting more agitated. "Where are you coming up with that?"

"Well, if we multiply $20,000 X 12 months, my math says that is $240,000 . . . Right?"

"Uh, yeah, but this is a stated loan."

"A stated loan?"

"Yeah, a stated loan."

"But, Mr. Borrower, a stated loan means you state what YOU made last year . . . Not what Will Smith netted
on a slow Saturday night."

"Well, what good is it if I have to state what I make?" (I'm guessing this is as opposed to what Will Smith
makes . . . )

"You can state your income, and not have to prove it with income taxes, but you have to state YOUR income.
Not what you wish it was, or what it might be, or what you think will get you this loan . . . You state your income,
truthfully."

Well, he didn't want to do that and I didn't want to not to do that so we agreed to disagree and I haven't done
his loan . . . But I can't count the times I've said, "No, if you're not going to live there, you can't have an owner-
occupied rate," or "No, having another home in the same subdivision is NOT a second home, even if you do put
your ex-wife and children in it," or, "You know, I'd really like for you to have this house" (and I'd really like to
close this loan since I've wasted so much time on you) "but what you are suggesting is loan fraud, and I'm not
willing to risk jail so you can . . . (fill in the blanks)"

Everyone is responsible . . . Lenders did take loans that met criteria that appeared to be sufficient to cover their
exposure and wasn't; borrowers did take loans they wouldn't be able to afford in two years because their wives
wanted in a house, and their children needed a good neighborhood. Speculators in the real estate market
jumped on the property bandwagon and drove it away, because they could, and because they wanted to.

Because Americans believe in having it all and having it now, and the credit industry (all of it, not just
mortgage lenders) encourages the spend, spend, spend mentality and think about it tomorrow, Scarlet
irresponsibility.

I've NEVER been a Chicken Little. I'm the extreme optimist . . . but this meltdown, that started out as the
"sub-prime" meltdown, and has turned into

• the CEO of Countrywide mortgage predicting that the major 10 lenders in the country will go to five
  major lenders soon;

• Australian funds that are tallying their losses because they bought real estate securities in the US;

• Lenders scrambling to keep people out of foreclosure with forebearance contracts and payment plans
  and then they go into foreclosure, only it is three months later than they should have.

• Massachusetts setting up a $250 million fund to help 1,000 homeowners. . . New York,
  $100 million to help 500 homeowners?

So now it is My meltdown. I don't worry about my job anymore, or even about my industry.

Now I'm worried about my country.