What is the alternative to debt forgiveness

20Cent

I see lots of criticism of Morgan Kelly idea but what is the alternative?
100,000 + homeless families totally disenfranchised from society. I imagine that would cost a lot more than the 5 or 6 billion he is suggesting.

ei.sdraob

Getting these people back to work

swampgas

20Cent wrote: »

I see lots of criticism of Morgan Kelly idea but what is the alternative?
100,000 + homeless families totally disenfranchised from society. I imagine that would cost a lot more than the 5 or 6 billion he is suggesting.

100,000 families without a mortage on a house is not the same thing as "homeless". People can rent somewhere to live, they don't have to live on the streets.

Anyhow, "debt forgiveness" should be renamed to something more accurate - "debt transfer" perhaps.

20Cent

ei.sdraob wrote: »

Getting these people back to work

A lot of these people are in work. Thanks to the banks wreaking the economy paychecks are getting less and less, taxes and charges going up.

MajorMax

I think that tax credits for mortgage holders should be increased, but a portion of the mortgage 20-25% should be paid directly to the Government as payback for the bailout

Gumbo

MajorMax wrote: »

I think that tax credits for mortgage holders should be increased, but a portion of the mortgage 20-25% should be paid directly to the Government as payback for the bailout

I presume you mean by the bank as such yeah?

swampgas

20Cent wrote: »

A lot of these people are in work. Thanks to the banks wreaking the economy paychecks are getting less and less, taxes and charges going up.

So-called "debt forgiveness" is a non-starter. Have a read through this thread, it's been argued to death:
http://www.boards.ie/vbulletin/showthread.php?t=2056323790

Helping out the genuinely needy should be handled by social welfare and improved bankruptcy laws, not by simply paying off people debts for them.

People really need to understand that they cannot keep a house for which they cannot pay the mortgage - it's really that simple.

That doesn't mean they have to be homeless, just that they need to change their living arrangements - move to a cheaper house if possible, or rent.

There is incredible resistance to moving home in Ireland, this seems to be part of the problem - people simply won't accept that they might have to move out of "their" house and live somewhere else. In fact they seem to think they are entitled to live in "their" house for ever and ever, even if it means someone else has to pay off a big chunk of their mortgage for them.

supermonkey

The alternatives to debt forgiveness are bankruptcy and non recourse repossession.

The current argument is a 'won't pay' argument.
My house is worth less than I paid for it so I won't pay but it is a nice house and it has 6 bedrooms so I won't move into a little house either.

Bankruptcy is a can't pay argument because you lose other assets and the bank can offset these against their losses on your mortgage.
Irish bankruptcy rules are cruel.

My preferred solution is bankruptcy with an instant release for honest debtors.

Another alternative is essentially to make the home loan 'non recourse' that is the debt on a house is secured by that house.

I don't like that solution because if I am a landlord who owns nine houses and three are underwater I can hand those three back to the bank and keep my Ferrari and 6 other houses.

JoeGil

If a person is in genuine difficulty then the portion of the debt that is beyond their means can be deferred for repayment at a later date. If this is not possible during the lifetime of the mortgage then latest when the motgage term expires, the house needs to be sold and the deferred portion repaid from the proceeds.

Everybody needs to be responsible for and pay the debts they have taken on - otherwise all of society becomes disenfranchised.

swampgas

MajorMax wrote: »

I think that tax credits for mortgage holders should be increased ...

Why? Why should mortgage tax credits exist at all in the current climate?

I have never understood why anybody's mortgage should be subsidised by other tax payers. All the tax credit did was help fuel a housing boom by pushing up prices.

EI_Flyboy

swampgas wrote: »

Why? Why should mortgage tax credits exist at all in the current climate?

I have never understood why anybody's mortgage should be subsidised by other tax payers. All the tax credit did was help fuel a housing boom by pushing up prices.

Well then why should the banks be subsidised by the taxpayer? How is it a paper entity has more rights than breathing flesh and blood entities...?

swampgas

EI_Flyboy wrote: »

Well then why should the banks be subsidised by the taxpayer? How is it a paper entity has more rights than breathing flesh and blood entities...?

The banks were subsidised to keep them open.

Why do you feel that anyone should get a tax break for a mortgage? Why not for a car loan, or maybe a tax break against a credit card bill? Why should you get money from other tax payers (which is what a tax credit is) for something as normal as borrowing money?

EI_Flyboy

swampgas wrote: »

The banks were subsidised to keep them open.

Why do you feel that anyone should get a tax break for a mortgage? Why not for a car loan, or maybe a tax break against a credit card bill? Why should you get money from other tax payers (which is what a tax credit is) for something as normal as borrowing money?

They may aswell have shut for all the good their doing, there haven't been any real loans coming out of them for awhile now. There are thousands of empty houses out there essentially owned by you and I, they're rotting away and losing value. That value reflects on our investment in them. Why kick people out of houses only to leave them empty and rotting. I'd much prefer if they had responsible people living in them and sustaining their value. No one's better suited to that than someone who feels it's their home or their family's home. Writing off their mortgages may not be a great idea but why not give them a mortgage holiday?

supermonkey

JoeGil wrote: »

If a person is in genuine difficulty then the portion of the debt that is beyond their means can be deferred for repayment at a later date.

So they get a house they can't afford. Why?

EI_Flyboy

supermonkey wrote: »

So they get a house they can't afford. Why?

So that it's not left empty and rotting, losing it's value. The bank took a risk giving them a mortgage, they should shoulder some of consequences when their gamble doesn't pay off, that's only what you're expecting from the rest of us. Putting families on the street doesn't lead to anything possitive for the rest of us.

Godge

EI_Flyboy wrote: »

They may aswell have shut for all the good their doing, there haven't been any real loans coming out of them for awhile now. There are thousands of empty houses out there essentially owned by you and I, they're rotting away and losing value. That value reflects on our investment in them. Why kick people out of houses only to leave them empty and rotting. I'd much prefer if they had responsible people living in them and sustaining their value. No one's better suited to that than someone who feels it's their home or their family's home. Writing off their mortgages may not be a great idea but why not give them a mortgage holiday?

Who says the house will be left empty and rotting? It will have some value and someone will buy it.

Debtocracy

JoeGil wrote: »

Everybody needs to be responsible for and pay the debts they have taken on - otherwise all of society becomes disenfranchised.

This is impossible. There will always be sections of society facing default and bankruptcy because of the nature of the monetary system. It's like a game of musical chairs, someone will always be left standing when the music (i.e. credit) stops.

EI_Flyboy

Godge wrote: »

Who says the house will be left empty and rotting? It will have some value and someone will buy it.

Ok so, why not move them into one of the thousands of empty and rotting NAMA houses instead? That solves two problems with one stone.

On the other hand you could merely let them have a mortgage holiday. This maintains the property's value while there's no guarantee of an imediate sale. Plus at the end of the mortgage holiday, payments can resume at a higher rate than the bank would get from a mortgage on a property at the current market values.

libra02

The way I see it is the mortgages need to be extended and a lower or no interest be applied for the extra years.

So if someone has a 35 year mortgage it should be exteneded to 45 years and for the last 10 years have no interest or a extrememly low rate.

That way the bank still recoups the cash and it helps ease burden on the mortgage holder.

EI_Flyboy

JoeGil wrote: »

Everybody needs to be responsible for and pay the debts they have taken on - otherwise all of society becomes disenfranchised.

You're living in the wrong country to be talking about responsibility!

JoeGil

supermonkey wrote: »

So they get a house they can't afford. Why?

Well they already have it and the damage is done. It's true they should never have been in a position to buy the house at the price they paid but that's not the way Ireland worked 5 years ago.

In the current environment where houses are not selling, deferring part of the debt until it can be repaid makes more economic sense. At some point in the far off future it may make more economic sense to have the person sell the house, pay off the debt and buy one within their means.

supermonkey

EI_Flyboy wrote: »

So that it's not left empty and rotting, losing it's value.

Take the house off the delinquent borrower and sell it to someone else at its current value.
I'd rather burn your house than pay for you to drive around in a Porsche Jeep, watch a flat screen TV and chop onions on a marble counter.
You want those who made bad decisions to suffer no censequences for those bad decisions.

supermonkey

JoeGil wrote: »

Well they already have it and the damage is done.

We are where we are ...

JoeGil wrote: »

In the current environment where houses are not selling

Because the prices are still too high

sarumite

I believe the correct answer to the OP's question is Bankruptcy.

The alternative to debt forgiveness for those who cannot pay their mortgage is bankruptcy.....well In places with proper bankruptcy laws. Instead of focusing on debt forgiveness (read 'debt transfer') we need to focus on changing bankruptcy laws so that it is a viable option.

Floppybits

sarumite wrote: »

I believe the correct answer to the OP's question is Bankruptcy.

The alternative to debt forgiveness for those who cannot pay their mortgage is bankruptcy.....well In places with proper bankruptcy laws. Instead of focusing on debt forgiveness (read 'debt transfer') we need to focus on changing bankruptcy laws so that it is a viable option.

Reformed Bankruptcy is the answer really. The problem is that people are now stuck, no matter what they do or where they go the mortgage outstanding on the house will always follow them. What needs to happen is that people who fall into this can hand back the keys to the house and walkaway, they get black listed for 7 years but it also means that they don't have the debt hanging over them. Then these people can rent smaller homes or apartments and work to get back onto their feet.

In the current situation the lender is not taking any hit all for their poor investment decision, it all falls onto the person taking the loan.

So until the bankruptcy laws are updated there wont be away out of this for anyone unless they hand back the keys and leave the country.

Godge

You know the big elephants in the room when it comes to debt forgiveness are the external people involved in this country.

I don't just mean the EU/IMF who would want details of the social welfare cuts/education cuts/hospital closures that would be implemented to pay for the debt forgiveness. Don't suggest extra taxes as the EU/IMF will not want to see extra tax for extra expenditure. They will want expnditure cuts to implement expenditure proposals so anyone who wants to spend 10 billion over five years on debt forgiveness should be forced to identify the 2 billion a year in additional cuts over and beyond what is coming.

But there are also the foreign banks active in the mortgage market. If the Irish state-owned banks (and I include Bank of Ireland as these new losses would probably force them into state ownership) are forced to forgive debt, the taxpayer will pay for it (see previous paragraph) but who will pay for the debt forgiveness given by Ulster Bank, National Irish Bank or Bank of Scotland all of which are owned by banks outside this country?

On the one hand, you can't expect people to be treated less favourably because of the bank they are with. On the other hand, these banks will sue if they are forced to hand over money, we will lose, and the taxpayer will have to pay up.

So my grandchildren will be paying extra taxes in thirty years time not only to rescue the Irish-owned banks but also the Danish and UK-owned banks. All for people who lost the run of themselves in the Celtic Tiger and want to hold on to their McMansions. Does anybody think any of these things through?

EI_Flyboy

supermonkey wrote: »

I'd rather burn your house than pay for you to drive around in a Porsche Jeep, watch a flat screen TV and chop onions on a marble counter.
You want those who made bad decisions to suffer no censequences for those bad decisions.

Wow! How do manage to sleep at night after the bank bailouts and NAMA then? Unless you have actually been busy with your matches and fuelcan...? Either that or you're FOS. I was thinking of those whose kids go without so the mortgage gets paid, but hey, maybe that's just me.

thebman

EI_Flyboy wrote: »

Wow! How do manage to sleep at night after the bank bailouts and NAMA then? Unless you have actually been busy with your matches and fuelcan...? Either that or you're FOS. I was thinking of those whose kids go without so the mortgage gets paid, but hey, maybe that's just me.

Those things were done for the taxpayer. Almost everyone has either savings or a loan and the Irish banks are kittens compared to who might get their hands on those loans if they went under.

EI_Flyboy

thebman wrote: »

Those things were done for the taxpayer. Almost everyone has either savings or a loan and the Irish banks are kittens compared to who might get their hands on those loans if they went under.

That may be but surely similar courtesy should be extended to those who can either feed their faimly or pay their mortgage but not both.

thebman

EI_Flyboy wrote: »

That may be but surely similar courtesy should be extended to those who can either feed their faimly or pay their mortgage but not both.

How many of these people are there really though? The guy in the Irish Times refused to talk to his bank about his problems. The bank are allowing people to go interest only and in some cases pay only two thirds of interest so the issue seems to be more that he doesn't want to talk to his bank which is causing him to not be able to feed his family.

Mr.Micro

thebman wrote: »

How many of these people are there really though? The guy in the Irish Times refused to talk to his bank about his problems. The bank are allowing people to go interest only and in some cases pay only two thirds of interest so the issue seems to be more that he doesn't want to talk to his bank which is causing him to not be able to feed his family.

The impression I get, I stand to be corrected, is that these people who want mortgage forgiveness do not want to have to pay anything back at all, the slate wiped clean but keep the house and whatever. So are not interested in any compromise with their lenders. I have to admit its a wheeze and an Irish solution to an Irish problem that would not be tolerated or entertained anywhere else in the world.

sollar

The only option is some form of bankruptcy cum non recourse solution for struggling home owners. They can declare themselves bankrupt to avail of debt forgiveness. They get to walk away from their debts but they lose the house. Or they can rent it back of the government or new owners.

The idea of someone getting 200K written off their mortgage yet still own the house is unthinkable to most of us who pay our debts but still struggle along.

El chapucero

Who is really to be forgiven ?
If the bank checked the value of a house on day 1,say back in 2006, and issued a mortgage for this value then the same bank should now absorb at least half of the equity loss. You could argue that if this was the case then if the value of the house increased the homeowner would have to pay back more to the bank.
But the banks have enough economists etc to know what they were doing back then and only they knew how much money they were actually throwing around the place ,more so than the individual borrower.I don't think it was reckless borrowing to buy a home for your family,particularily when the prices were shooting up but I do think it was reckless lending.
Imagine that the same banks that are being bailed out using money extracted from mortgage holders are actually increasing the variable interest rates charged to the same mortgage holders and getting away with it.

Godge

El chapucero wrote: »

Who is really to be forgiven ?
If the bank checked the value of a house on day 1,say back in 2006, and issued a mortgage for this value then the same bank should now absorb at least half of the equity loss. You could argue that if this was the case then if the value of the house increased the homeowner would have to pay back more to the bank.
But the banks have enough economists etc to know what they were doing back then and only they knew how much money they were actually throwing around the place ,more so than the individual borrower.I don't think it was reckless borrowing to buy a home for your family,particularily when the prices were shooting up but I do think it was reckless lending.
Imagine that the same banks that are being bailed out using money extracted from mortgage holders are actually increasing the variable interest rates charged to the same mortgage holders and getting away with it.

This is cloud cuckoo land time. If you had a policy that banks could only be hit by the downside and not benefit from the upswing, they would never lend another penny or if they did it would have to be at penal interest rates. They would shut up shop and move out of Ireland.

If I was running a foreign bank in Ireland at the moment (NIB, Ulster Bank etc) I would not be lending any money until I saw whether the government was stupid enough to opt for one of the debt forgiveness options.

People looking for debt forgiveness are looking backwards not forwards and they run the risk that we will never get investment in this country ever again.

ei.sdraob

Godge wrote: »

This is cloud cuckoo land time. If you had a policy that banks could only be hit by the downside and not benefit from the upswing, they would never lend another penny or if they did it would have to be at penal interest rates. They would shut up shop and move out of Ireland.

If I was running a foreign bank in Ireland at the moment (NIB, Ulster Bank etc) I would not be lending any money until I saw whether the government was stupid enough to opt for one of the debt forgiveness options.

People looking for debt forgiveness are looking backwards not forwards and they run the risk that we will never get investment in this country ever again.

Rte mentioned yesterday that BOI/AIB have not been lending as much as they promised they will, apparently due to "no demand"

Waiting is what the banks are doing now, the more the government gets involved the uglier things get, any sort of forgiveness without the assets being transferred will result in system breaking down as people chose not to pay and seek the easy way out

Godge

ei.sdraob wrote: »

Rte mentioned yesterday that BOI/AIB have not been lending as much as they promised they will, apparently due to "no demand"

Waiting is what the banks are doing now, the more the government gets involved the uglier things get, any sort of forgiveness without the assets being transferred will result in system breaking down as people chose not to pay and seek the easy way out

Exactly, and we are sinking into the Irish trait of focussing on past injustices rather than on how we can work hard to get ourselves out of the mess. Anyone for 800 years of oppression by the banks?

RichardAnd

Just a thought, what is it that's kicked off all this talk of mortgage forgiveness over the last two weeks? I know Morgan Kelly mentioned something about it but the meadia really seemed to have jumped on the train. Considering that the Irish media are warm bed fellows of the powers that be, it makes me wonder what's going on

ei.sdraob

RichardAnd wrote: »

Just a thought, what is it that's kicked off all this talk of mortgage forgiveness over the last two weeks? I know Morgan Kelly mentioned something about it but the meadia really seemed to have jumped on the train. Considering that the Irish media are warm bed fellows of the powers that be, it makes me wonder what's going on

I dont think the government are involved, aren't they all still tanning themselves down the Algarve this time of year?
We had several pronouncements of "we turned a corner" and "all is well" hence it seems like we have plenty of money to be "forgiving" debts and letting people keep their homes to...

Wait till the autumn and the budget when the harsh reality of our position rears its head,

To put things in perspective
* 6 billion of "mortgage forgiveness" is more than 40 years of 100 a year property tax that is coming
* 542 million is allocated to "interest relief" and rent supplement this year, there is still plenty of fat on the bone that needs cutting

El chapucero

okay don't forgive any debt and take back the money given to "forgive" the Banks. Afer the ICI affair and AIB surely somebody in the Government should have said "No More if you mess up again you are on your own"
There either should be forgiveness for all or no forgiveness. And if no forgiveness then stop adding Universal Social Charges,Household Taxes etc.

CiaranC

El chapucero wrote: »

okay don't forgive any debt and take back the money given to "forgive" the Banks. Afer the ICI affair and AIB surely somebody in the Government should have said "No More if you mess up again you are on your own"
There either should be forgiveness for all or no forgiveness. And if no forgiveness then stop adding Universal Social Charges,Household Taxes etc.

Who is this "all"? I lost twenty quid in the bookies this morning, am I covered too?

sarumite

El chapucero wrote: »

okay don't forgive any debt and take back the money given to "forgive" the Banks. Afer the ICI affair and AIB surely somebody in the Government should have said "No More if you mess up again you are on your own"
There either should be forgiveness for all or no forgiveness. And if no forgiveness then stop adding Universal Social Charges,Household Taxes etc.

Can we stop with this "forgiveness for the banks" nonsense. There was no forgiveness. The government now owns the banks. The original owners (shareholders) saw their shares become worthless.

Godge

sarumite wrote: »

Can we stop with this "forgiveness for the banks" nonsense. There was no forgiveness. The government now owns the banks. The original owners (shareholders) saw their shares become worthless.

Good point. Will those who want their mortgage debt forgiven be prepared to give up their house, car, pension and any savings and move into rented accommodation and start again?

El chapucero

The Government bought the Banks because they felt the had to (pressure from the Big Brothers in the Euro vicinity-who designed a common currency with flashy coins and notes that had absolutely no common fiscal controls- how many overpaid bureaucrats were needed to design the Euro?) not because the always wanted to own the banks. I would say a lot of mortgage holders would be happy to have their debt "forgiven" and hand back the keys,walk away and start again. All this rubbish about restructuring mortgage debt is a joke;again the banks win with more interest while the helpless mortgage holder has to slave away for more years to pay got something that is 50% worthless.

jmayo

EI_Flyboy wrote: »

Well then why should the banks be subsidised by the taxpayer? How is it a paper entity has more rights than breathing flesh and blood entities...?

So because the banks were subsidised, a few of them very foolishly in my opinion, the taxpayers should now go off and subsidise some people who decided to buy something that they might not be able to afford and now want out of their committments ?

El chapucero wrote: »

okay don't forgive any debt and take back the money given to "forgive" the Banks. Afer the ICI affair and AIB surely somebody in the Government should have said "No More if you mess up again you are on your own"
There either should be forgiveness for all or no forgiveness.

Where does your forgiveness stop ?
Surely it shouldn't just apply to those who happen to have signed up to huge mortgages ?
What about those of us without mortgages ?
What can we get forgiven ?

For a start I want money because my last car blew it's engine and cost me over 5,000.
I also want money because my penions lost nearly 40% of it's value in 2007/2008.

El chapucero wrote: »

And if no forgiveness then stop adding Universal Social Charges,Household Taxes etc.

Yeah lets have no taxes at all and forget about the 20 billion budget deficit. :rolleyes:
What fooking planet are some people on ?
No wonder so many people royally fooked up.

El chapucero wrote: »

The Government bought the Banks because they felt the had to (pressure from the Big Brothers in the Euro vicinity-who designed a common currency with flashy coins and notes that had absolutely no common fiscal controls- how many overpaid bureaucrats were needed to design the Euro?) not because the always wanted to own the banks.

Yep it's all the fault of the Euro. :rolleyes:

El chapucero wrote: »

I would say a lot of mortgage holders would be happy to have their debt "forgiven" and hand back the keys,walk away and start again. All this rubbish about restructuring mortgage debt is a joke;again the banks win with more interest while the helpless mortgage holder has to slave away for more years to pay got something that is 50% worthless.

So the banks win by getting people to pay back their debts, which might mean the banks owners i.e. us taxpayers might see something back as opposed to your bright idea where the banks write off huge chunks of debt and ultimately the taxpayers lose even more ?

BTW it doesn't matter what the fook the house is worth, you owe the amount you borrowed.
Would you have paid the bank back more if the bubble had continued as lots of people believed and your hosue was worth 50% more ?

jackbetal

Of course there should be no debt forgiveness. Haven' the banks taken enough off the taxpayer. Where people have debt due to direct consequence of the banks reckless lending then the banks should be made take this debt and park it where they can. If the banks cannot live their with mistakes then the will just have to follow capitalist rules and go under making plenty of room for other banks to take their places.

El chapucero

okay it is fair to say that you owe what you borrowed - but that does not justify piling extra taxes on borrowers and others to pay off for borrowers (including banks) who don't or cannot pay what they borrowed.
I can see no benefit in think that "we" own the banks because for sure,like all these big public systems,when the costs and fat bonuses,company cars,big lunches,subsidsed canteens(or do they all bring in their own flasks and sandwiches?),low interest loans,training courses on what and other expenses are paid will the ordinary taxpayer recoup,with interest, all what he/she was forced to put in for the famous bailout?
Will they trim the fat -become a mean lean lending machine just because the State took them over?
Also what about the Financial Regulator? I thought that he was supposed to regulate all the banks.Some job - now you have stories of children eating cardboard cereal boxes in Tralee with unknown widespread hardship to follow.

EI_Flyboy

jmayo wrote: »

So because the banks were subsidised, a few of them very foolishly in my opinion, the taxpayers should now go off and subsidise some people who decided to buy something that they might not be able to afford and now want out of their committments ?

I just think that if the bankers are still driving around in their nice cars and living in plush Foxrock houses, then it's hardly fair that anyone should be expected to starve. I'm not saying bail out everyone, only those who truly need it and especially those with families.

jmayo wrote: »

I also want money because my penions lost nearly 40% of it's value in 2007/2008.

That's been coming a long time. I used to audit pension schemes, they've been unregulated and mismanaged for donkey's years. The only pension worth having is one who's board are also members of the scheme. If they aren't, take your money elsewhere bacause the odds that they actually care are very very slim. When it comes to pension meetings, they'll be looking out the window dreaming of the 18th hole.

Godge

jackbetal wrote: »

Of course there should be no debt forgiveness. Haven' the banks taken enough off the taxpayer. Where people have debt due to direct consequence of the banks people's reckless lending borrowing what they could not afford to pay back then the banks people should be made take this debt and park it where they can pay back every penny. If the banks people cannot live their with mistakes then they will just have to follow capitalist rules and go under and declare bankruptcy making plenty of room for other banks people to take their places.

FYP

jackbetal

Godge wrote: »

FYP

So you do not think that the fault is completely on the side of the borrower and that the banks did not recklessly lend?

RichardAnd

jackbetal wrote: »

So you do not think that the fault is completely on the side of the borrower and that the banks did not recklessly lend?

It takes two to tango and in this case, the fault rests with both the banks and the borrowers. Though it's populist to do so, blaming the banks alone is akin to blaming a barman for a hangover.

Godge

jackbetal wrote: »

So you do not think that the fault is completely on the side of the borrower and that the banks did not recklessly lend?

The process starts with an application from a borrower to the bank for a loan. The bank can only be reckless if the applicant has already been reckless in applying for a loan.

There is some possibility that if a couple filled out an application form for a €100,000 loan on a €200,000 house and the bank said to them with that amount of deposit and your income including bonuses, why don't you apply for a €400,000 loan on a €500,000 house. Now in that case the bank was reckless but that it likely to be the exception rather than the norm.

You will find, if you look closely, that many of the people who over-borrowed used mortgage brokers who massaged their figures or advised them how to fill the forms in order to get the maximum from the banks. Sure, the banks erred in trusting the mortgage brokers but the brokers were acting on behalf of the borrowers. If anyone acted consistently recklessly during the boom it was the brokers. Good luck chasing them for the money.