WaMu Job Cuts and Closings

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Washington Mutual is ridiculous. It is trying to do more with less all at the employees expense. Employees are working with No Lunches and No Breaks and God forbid you call in sick. This Bank is going down in flames.

Above Posted By: Anonymous | Tue, 20 May 2008 21:04:22 EST

Sarah: If you are still out there, I'm curious to hear the specifics of how your broker wasn't honest with you. What did you believe to be true about your loan? What was the actual truth? Which of these was reflected in the loan documents you signed?

Above Posted By: tom | Mon, 14 Apr 2008 13:26:56 EST

WAMU's biggest problem was the option arm loan that gave the customer the ability to pay 1% instead of the going rate. I'm a mortgage lender and lost numerous transactions to WAMU last year because my company refused to jump on that product, thankfully. The customer would buy a house that he/she couldn't afford and the 1% option arm was the only way they could afford the loan. So, off to WAMU they went expecting that SOMEDAY they would refi out of this loan. Unfortunately, most people get "comfortable"with the low payment and never refi out of it and their principal balance keeps growing. That coupled with values going down and now they are upside down and nobody can help them out of the problem THEY put themselves into. I've had numerous people call me in the past 3 months saying "I wish I would've listened to you and took your 30 year 5.5% rate instead of going with the option arm loan" and, "can you help me refi out of?" Unfortunately, the answer is NO because they owe more then the house is now worth. My opinion, for what it is worth, is that the problems the mortgage industry is having is due to buyers wanting to buy more house then they can afford, homeowners sucking every dollar of equity out of their existing homes to pay off large credit card debt that THEY incurred purchasing items they can not afford, and investors driving the values up in small towns doing flip transactions to drive the market up so they can sale their other investments for more profit. Investors will move into a small area, purchase several homes at the market value and several at a higher price, turn around and sale the 1st and 2nd home that they purchased at market value for the inflated value, now appraisal supported, that THEY just created by paying more then market value. Do you understand that concept? I have watched investors move into Las Vegas and Arizona areas and small town areas driving the price up so they can make a huge profit. They leave town with $500,000 cash from their "investing" and move on to another town that they can manipulate the market with. Values don't go up as drastically as they did if there isn't somebody manipulating the system, as investors are well trained at doing. Add to that investors who were willing to purchase the loans to make more money on their investment then the stockmarket pays. Now those investors are folding because the borrowers aren't paying their mortgages and they are having to foreclose. And we, the normal homeowner, are having to bail everybody out who bought more home then they could afford and investors who were greedy. I am so sick of hearing about the poor homeowner who is now facing foreclosure after they sucked $60,000 out of their equity to pay off credit card debt for the third time in three years. They just keep running up the debt and refinancing to pay it off. It must be the lenders fault that the investors were willing to buy the paper for these borrowers. Yea, right.

Above Posted By: Max | Wed, 9 Apr 2008 21:27:38 EST

Do you all know how the Washington Mutual employees were notifed of their impending job loss? By email. And on that email were the SMILING faces of the company heads (probably thinking about their bonuses). That number of 3,000 losing their jobs...? Grossly underestimated. Try doubling that. Some of these mortgage lenders have been loyal employees for 15, 17, 20-plus years. These are people who take what they do very seriously, they really are there to HELP people, not rip them off just to make a buck. Mortgage lending is the CAREER, not just a paycheck. By the way, I do not work in the lending, real estate, or finance industry, I work with these people, however, and many of them are very fine people.

Above Posted By: Anonymous | Wed, 9 Apr 2008 15:19:52 EST

WaMu closed a lot of the underwriting and processing offices nationwide back on December 10th. They also eliminated their Retail Loan Consultant positions coast to coast at that time as well. There were/are rumors that Chase was to have been in negotiations to purchase WaMu since July of 2007. It's looking and sounding more and more like WaMu is trying to make themselves look more attractive by eliminating positions and closing offices before they accept a low offer to be bought. The methods of buying companies and then cleaning house has changed. WaMu got into some trouble some years back when they lost their government licensing for mortgage loans. They haven't been able to bounce back ever since. I predict that within 3 months they will announce a "merger", take over by Chase or another company.

Above Posted By: Ex WaMu Home Loan Guy | Wed, 9 Apr 2008 14:38:32 EST

It truly does not surprise me that banks are now pointing the finger at us brokers. Now they want to wipe us out so they can go screw the borrower in fees and in rate! It was the banks who underwrote and approved these borrowers who worked at Walmart and told them they could buy a home for $400,000. And the borrowers, did they really think with their "real" income they could afford a house at $400,000? If it looks too good to be true, then it probably is.

Above Posted By: KYB | Wed, 9 Apr 2008 14:16:17 EST

Rick, you can't blame brokers for loans that were created by Wholesale banks that both brokers and banks wrote and banks' underwriters approved. Although I agree on the old school method of getting into a home, I would question that 78% of loans in this country were writen by brokers are now going into foreclosure. That would seem high even if every single broker in the U.S. was doing hanky panky in the industry. Where did that 78% number come from that you mentioned? If it was from WaMu, we may question the information based on the source that it is coming from.

Above Posted By: Anonymous | Wed, 9 Apr 2008 11:07:02 EST

While brokers were bragging that in 06 they did 65% of the loans in the country it should well be noted that over 78% of the foreclosures going on in the country are loans originated by brokers. The worst thing to ever happen in the industry was the stated loan and the fact that states made it to easy to get a brokers license. I believe in old school financing if you have a salaried position and know how much you bring home each paycheck then you have no business going stated, only commissioned and business owners should go stated within reason. If that means that you cannot afford a house at this time then so be it. These banks were crazy giving someone with a 560 score 100% stated, there was no incentive for that person to ever clean up their credit. For the few brokers who did the right thing I applaud you but there were tons who cared nothing about the customer only their pockets because if any borrower had any sense they would go to a bank lower closing cost maybe the rate was an 1/8 or .250 higher but if a customer couldn't pay that then they were in too much house.

Above Posted By: rick | Wed, 9 Apr 2008 05:55:31 EST

WHOO HOO!!!!!

Above Posted By: Al | Tue, 8 Apr 2008 19:08:07 EST

Everyone wants to blame the Mortgage Broker for everything. Every industry has its share of bad apples including the brokerage business but there are just as many people who were preyed upon by bad Retail Bank Loan Officers. The Banks then looked the other way and approved these bad deals based on acceptible lending practices that Fannie and Freddie endorsed. The rest of the story gets worse after that. A lot of people got rich at John Q Publics expense.

Above Posted By: Brian | Tue, 8 Apr 2008 14:57:12 EST

Unfortunately pointing fingers is not going to solve the issue. While there were many brokers that were looking for their best interest, the consumer was also at fault. Most buyers were looking to make a profit as they saw property values go up. What ever happened to buying a home so that your family can grow up there and you can have something of value when you retire. It seems like most buyers recently were purchasing homes just because they wanted to make a quick profit. The fact is, there are a lot of good opportunities out there for 1st time home buyers and the rates are great but if you are buying so that you can make some money off the equity in the future, don't be surprised if you do not see the equity in your home increase as quickly as it did in the previous years. To those of you thinking of buying a home, do it now but do not buy if you know you can't afford it. Don't let the broker or agent tell you it is OK because all they really care about is when the loan/ purchase will fund so that they can get their commission check.

Above Posted By: JDMR | Tue, 8 Apr 2008 13:55:56 EST

Dear YourMom, Anything is possible. The banks have wanted to get rid of mortgage brokers for years. Buying up these wholesalers and then closing the doors suddenly seems suspicious. One thing to keep in mind in all of that, most of them, with the exception of WaMu's Sub Prime arm didn't have a Sub Prime arm until a year or in some cases, few years ago. What the Banks didn't plan on, is a Free market rate, which we really haven't seen for almost a decade.

Above Posted By: anonymous | Tue, 8 Apr 2008 13:45:49 EST

It makse no sense Judy.

Above Posted By: sarah | Tue, 8 Apr 2008 13:36:42 EST

I'd like to know when the Credit Card issuers will be held responsible for their part in the present credit crisis. We hear about the "mortgage meltdown" every day, but Credit Card companies go on with their own deceptive, unethical marketing practices, their bogus reasons for raising interest rates, "insurance" premiums for "Credit Protection policies" that the cardholder was not properly made aware of, their practice of allowing credit card holders to go over their balances and then charging outrageous overlimit fees. Of course consumers need to use their credit wisely, but I feel that credit card companies are predators just waiting for customers to make a mistake - then they pounce on them, beat them up and hold them hostage until they give up and allow their balances to be charged-off, or worse yet for the economy, declare bankruptcy. Does that make any sense?

Above Posted By: Judy | Tue, 8 Apr 2008 13:31:52 EST

BTW my credit wasn,t bad, however it wasn,t excellent, it was good at the time of the mortgage... subprime i might ask, i still don,t understand all of this..... thats why i depended on the broker.... basically put in to a loan much larger than i could afford and i didn,t know any better so these people who say all of us just had big eyes for a house, that thought is not true for all of us,,, we simply wanted to be a first time homeowner..... remeber all of those flyers on rental doors "buy for less than rent" well who knew?

Above Posted By: sarah | Tue, 8 Apr 2008 13:28:23 EST

chris, thanks for being honest, my broker wasn,t honest with me and now i am stuck with a condo i cannot afford, i had to declare bankruptcy, i am behind and have no idea how to catch up with all the fees and etc, oh ofcourse i am now not paying my income taxes so i can afford to stay in my house, does that make any sense? i wonder if others are doing the same thing? i could never afford my condo the only reason i have kept it so far is because i got a raise and don,t pay my taxes... and my car is paid for now.. there is no one to help me undo.. this has driven me to drink, no friends (since i cannot socialize since no funds) and severe anxiety and depression...

Above Posted By: sarah | Tue, 8 Apr 2008 13:21:00 EST

Agreed. I had a RE broker ask me to write a loan and I didn't do it because the borrower was 1099'd. The manager who could verify income, was conveniently on vacation until after the loan was going to close. So basically, I was speaking to his co-worker and going on paystubs that I wasn't sure about. Additionally, the individual hadn't sold his other home yet and could barely qualify with very little money in reserves. Since I couldn't verify income, I didn't write the loan. I don't know if the loan was completed by another mortgage broker, but that RE Agent/Broker, who was my biggest client, didn't send me any more deals after that.

Above Posted By: anonymous | Tue, 8 Apr 2008 13:13:38 EST

Wow, so Wamu is closing its branches and is no longer going to be doing wholesale. I shudder to think that this is something that the large retail banks and lenders are conspiring/planning to do across the board. I believe this would be no different than the monopoly that once existed in the phone industry. I don't think that the consumer will be best served. Retail operations will overcharge consumers one way or another. Rates will be bumped up and Rebates (profit) will be hidden. Racial bias has also been proven time and time again within these so called "established" institutions and will continue. Without "Fair" competition the consumer and economy will be affected greatly.

Above Posted By: YourMom | Tue, 8 Apr 2008 12:57:36 EST

AMAZING how the mythology that the "brokers" did this. I agree whole heartedly that there are countless mortgage brokers out there that made a great living ripping people off. I was notorious within my last company for UNDERcharging. I also actually said "You can't afford this home" to potential buyers and guess what they did...went elsewhere. IN ONE INSTANCE, I said no and they went into a Countrywide Retail branch! That might be a poor example but I really wish these banks would stop fooling themselves and I really wish these homeowners would start taking responsibility. Just cause I might be able to qualify for an Aston Martin, doesn't mean it's the fault of the salesman or financier when I drive off with one just to have it repossessed 2 months later.

Above Posted By: Chris | Tue, 8 Apr 2008 11:45:31 EST

WaMu Job Cuts, Closings and Wholesale Shutdown

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