Bubble history: A $500,000 loan for a McDonald’s worker

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The Washington Post is in the middle of a three-part series on the housing bubble -- how it happened, what happened, and what happened when it burst. Worthwhile reading if you can carve a few minutes out of your day. Eye-poppers from the first installment, which chronicles the boom in sub-prime lending:

The annals of strange: Kevin Connelly, a loan officer at Pinnacle Financial, remembers the borrower who wanted to sign on behalf of her boyfriend because he was unavailable. Unavailable why? Well, you see, he was in jail. ‘Not a problem. Almost anyone could borrow hundreds of thousands of dollars for a house in those wild days. Connelly agreed to send the paperwork to the courthouse where the boyfriend had a hearing.... Still, Connelly said, ‘that was one of mine that goes down in the annals of the strange.’

Connelly also remembered securing ‘many loans for restaurant workers, including one for $500,000 for a McDonald’s employee who earned about $35,000 a year.’

And who was selling the loans? A mortgage lender could hire practically anybody. ‘It’s not rocket science,’ Connelly would tell new hires, such as the busboy who quickly traded in his Toyota Tercel (value: $1,000) for a Mazda Miata sports car (value: $25,000).

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