‘60 Minutes’ on the housing ‘house of cards’

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Good morning. ’60 Minutes’ again demonstrates why it is the best in the business -- the business of for-profit television news -- with this takeout on the mortgage crisis, titled ‘House of Cards.’

Highlights of the Steve Kroft report: ‘It sounds complicated but it’s really fairly simple: Banks lent hundreds of billions of dollars to homebuyers who can’t pay them back.’

A Stockton real estate agent on homeowners facing foreclosure: ‘They were never really invested. Most of the people who lost the houses didn’t lose any money because they never put any money down. Though their credit is damaged, and they could face legal action in some circumstances, they got to live in a new house for a couple of years, and some of them even managed to get some money with home equity loans or by refinancing.’

Another Stockton agent, Jerry Abbott: ‘They were getting loans in excess of 100 percent of the value of the property,’ Abbott says. ‘That type of thing. So, most of ‘em were actually putting a little bit of money in their pocket at close of escrow.’

‘So, they were getting paid to buy a house?’ Kroft asks.

‘They were getting paid to buy a house. Yes. Yeah,’ Abbott says.

The entire piece is worth reading, or watching. Plenty of blame to go around, Wall Street does not get off easily. And there is the (now) requisite interview with homeowners who are thinking about walking away from their mortgage. Your thoughts? Comments? Insights? E-mail story tips to peter.viles@latimes.com
Photo Credit: CBS News