Business Insider reveals Countrywide mortgage origination program called ‘The Hustle’.

The article published parts of the lawsuit that allege Countrywide eliminated nearly every underwriting checkpoint to push these mortgages through. Be warned: Some of the examples are shocking.

U.S. District Attorney Preet Bharara just announced that he’s filed a complaint against Bank of America alleging that Countrywide, its mortgage unit, purposely defrauded Fannie Mae and Freddie Mac.

It all centers around something called “the Hustle,” or (HSSL- High Speed Swim Lane) a strategy started in August of 2007 the D.A.’s office says Countrywide implemented in order to speed up the mortgage origination process.

From the complaint:

the hustle complaint

the hustle

The complaint goes on to allege that Countrywide was warned that this new process would result in loans of the poorest quality.

“Loans move forward, never backward,” became a Countrywide motto after the Hustle, the D.A. alleges, and executives removed “toll gates” that were supposed to slow down and force underwriters to review loan applications that were processed through Countrywides automated loan approval system, CLUES.

For example, one property in Miami was approved with the information that the mortgage holder made over $15,000 a month, when if fact they made just over $2,6000. The loan defaulted within 7 months of closing.

Then there’s the Alabama property where Countrywide allegedly failed to disclosed over $81,000 of debt held by the mortgage holder. to the GSEs.

Additionally, in order to boost the Hustle, Countrywide allegedly changed its compensation policy by giving out bonuses based on the quantity of loans originated, not on the quality of those loans.

Read more: http://www.businessinsider.com/bank-of-americas-hustle-program-2012-10#ixzz2AFAbyruo

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