The Washington Post’s George Will turns the rhetoric of “predatory lending” onto its head in a Thursday column:
Perhaps some lenders who were lied to were culpably indifferent to dishonesty because they planned to sell to others mortgages that the lenders knew were risky. But the victimization narrative that is turning turbulence in the housing market into a morality tale involves borrowers victimized by “predatory” lenders. The narrative remains murky because there is scant information about the percentage of currently distressed borrowers who were untruthful about their incomes or net worth when talking to lenders.
Here at HW, we’ve been trying to sound the horns on the fact that fraud isn’t just something that comes about because a lender or broker dupes an innocent borrower — the sort of rampant fraud we’re seeing in the 2006 and 2007 mortgage vintages is only possible when borrowers, too, decided that prices were infallible and making themselves into something they were not was a justifiable crime.
