Subprime Lenders Still Soaking Taxpayers

Arnold Kling

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Great White Parenthetical...

Another Stake in the Taxpayers...

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Business Week reports (I can't find the article on line, but they do have a podcast), [UPDATE: story here. Thanks to the first commenter.]

But Premier didn't just close down. Since it declared bankruptcy, federal records show, it has issued more than 2,000 taxpayer-insured mortgages--worth a total of $250 million. According to the FHA, Premier failed to notify the agency of its Chapter 11 filing, as required by law. In late October, an FHA spokesman admitted it was unaware of Premier's situation and welcomed any information BusinessWeek could provide.

The story, which includes many other examples, is headlined "The Subprime Wolves are Back." I think that the word "wolves" is an exercise in editorial license. The proper term is "sleazebags."

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COMMENTS (3 to date)

Latest Comment

Tom Myers writes:

It seems to be available as
FHA-Backed Loans: The New Subprime - BusinessWeek.

Posted December 3, 2008 8:30 PM

Speedmaster writes:

Disheartening. ;-(

Posted December 4, 2008 12:24 PM

The Snob writes:

Well I suppose the feds have to decide--do they want to solidify the financial system, or do they want to resuscitate the housing market? More evidence of Prof. Kling's Dead Parrot Policy at work here:

http://www.bloomberg.com/apps/news?pid=washingtonstory&sid=aElD2EJR0B2k

Now the question is, if the government is willing to bet everything on the housing market, is there a counter-bet to take a la Soros's move on the pound sterling back when? Or is this a case where the "failure" of that policy would be so cataclysmic that the counter-bet would be dried beans and ammunition?

Posted December 4, 2008 12:47 PM

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