Gangster Bankster

By Steve Campbell

The year is 2005.  You work for “To big to fail Bank” in the home loan center and the phone is ringing off the hook. Who is it you ask? Another Borrower looking for a home loan. Simple you say, I’ll take his application and run his credit. Easy money!  At this point in the home loan heyday if you’re alive and breathing, just talking on the phone gets you a commission check. The borrower says he needs the loan to close next week and the Realtor told them they need to come in with their highest and best offer; after all, there are three more competing offers on the house now, but the Realtor can’t tell you how much money the offers are for . Your guy on the phone has shaky credit, an unstable job history and oh yeah… he doesn’t have a down payment.  Matter of fact, the seller will have to pay all closing costs associated with the loan.  No problem!  You’ll just tack on another five thousand to the loan to cover your fees.  After all, you don’t work for free.  Although the earnest money is a photo copy of five one-hundred dollar bills, again you explain, “No problem!”  It’ll be a tough loan but you can do it.  In the borrower’s eyes you now walk on water!

A week goes by: appraisal, title, insurance binder and hand written pay stubs are all in. The file then goes to the underwriter who can’t understand why your guy is buying a $350,000 house on an annual income of 35K.  “No problem,” you say: the spouse sells items on eBay.  We’ll just “state” their income. The new application says they now make 100 grand a year. “Wow!” the underwriter says, “Although, I don’t feel too comfortable with this, “Loan suspended.”  Again “No Problem!” (cause that’s your slogan.)  You walk back to your cubicle where your sales manager is standing finishing off his third can of Red Bull at 10 AM and cry “the underwriter wants to kill my loan”. He smirks with confidence and then says, “No loan of ours is going to die on the vine!” Snagging another Red Bull he grabs the file and heads straight to the underwriter’s desk.  “What are you doing?” he asks the underwriter.   “We’re making 1 point origination and 4 points on the back end. That’s $17,500.00 dollars!  Are you nuts?”  He then reminds her that if we don’t meet our monthly sales goal we may have to lay off some people, starting with the underwriters. Next thing you know, the underwriter is grabbing the file,  sharpening her pencil and…you guessed it:  re-underwriting the file!

Sitting at your desk minutes later, your processor hands you back the file.  It reads: Final Approval- Clear to Close.  “Wow,” you say, “I can’t wait to call my borrowers and tell them that they can close this Friday.” Your borrowers are on cloud nine, you walk on water and your boss is a genius.  Can life get any better?  Oh yes, it can:  Next Friday is payday and this is your 9^th loan this pay period.  What will you do with another 30 grand?  To Big to Fail Bank is the greatest company in the world!   Heck,  you may just retire at age 27!  On your commute home that evening you have a fleeting moment of guilt:  “I’m not a crook or a gangster,” you convince yourself.   “I drive a BMW and wear a suit and tie.  I’m a Bankster!”