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By David Giffels
Beacon Journal staff writer
Published on Saturday, Oct 04, 2008
Nobody did the math?
Nobody calculated the wisdom of lending $45,620 for a house appraised at $31,230?
Nobody saw any problem with kicking in an additional $11,380 line of credit?
Nobody saw anything odd about granting a 30-year loan to an 86-year-old woman?
Maybe. But far more likely is that somebody did look at all those numbers and then decided, in a very calculated way, to give the loan anyway.
It depended on who was on the other end of the phone.
If Addie Polk had happened onto a loan officer with a strong moral compass, she might have been advised to seek counsel before taking on the mortgage and equity loan. If she'd fallen into the hands of someone who needed to pad his monthly numbers, she might not.
Luck of the draw.
What we're left with is a chilling bottom line:
A 90-year-old widow, losing the family home to foreclosure, who put a gun to her chest this week and pulled the trigger.
That's what happened to Addie Polk, who was granted the loan four years ago by Countrywide Home Loan, during a heyday of greed and unethical lending in a financial landscape studded with mines. Whether Countrywide — or this loan officer — can be called a predator in this instance is open to interpretation. But when sheriff's deputies arrived on Polk's doorstep Wednesday to serve the papers, Polk, who'd lived there nearly 40 years, chose the most drastic end imaginable.
Friday, still recovering in the hospital, the Akron woman was being portrayed on the floor of Congress as a poster child for the foreclosure crisis.
Her action leads one to wonder how many others have been driven to the brink of desperation, as countless Americans continue to untangle lives ruined by greed and unregulated activity.
In Ohio, we feel it worse than most. Even in the wake of state legislation to crack down on heinous lending practices, Summit County's foreclosure rate is among the highest in the nation.
Addie Polk's example is dramatic, perhaps the most dramatic yet. But the conditions that led to her desperation were everyday practice.
Insider speaks
Ask Mellanie Rittenour. From 2000 until 2006, the Tallmadge woman worked in the Cleveland office of MBNA America, which turned over a significant number of its loans to Countrywide immediately after origination. In 2004, when Addie Polk was sold her mortgage, Rittenour was working as a mortgage consultant.
She read of Polk's plight in Friday's Beacon Journal.
''I had to check my own mental list and go, 'There's no way I would have sold this woman a mortgage.' But there's definitely people out there who would have,'' Rittenour said.
In fact, she said, it was required practice in the collections department to ask customers with credit card trouble if they owned a home. If the answer was ''yes,'' the call was immediately transferred to the mortgage department. Failure to do so led to a dock in bonus pay.
Did it matter if the borrower was 86 years old?
No. As illogical as it seems, denying a 30-year mortgage to someone in her twilight years would be considered age discrimination.
Did it matter that the amount of the loan seemed out of balance with the home value?
Not necessarily, especially considering that market value is usually much higher than tax appraisal.
What it really came down to was the gut-level ethics of the person who handled the transaction.
''The majority of people, at least the ones I knew, would be responsible,'' Rittenour said. ''If they got (a customer) they thought was not competent, they would encourage them to talk to family or seek professional advice. But there were some people who were more concerned with what was in their monthly bonus check.''
Plenty of people have argued these past few weeks about the merits of regulation.
When the difference between a good loan and a bad loan depends on whether the lender's representative is a good person or a bad person, and when that line can be blurred by the urge to make a commission, something's wrong.
When it's a matter of life and death, it can't be left to chance.
David Giffels is a Beacon Journal columnist. He can be reached at 330-996-3572 or at dgiffels@thebeaconjournal.com.
Nobody did the math?
Get the full article here.
Comments
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Posted 10:15 AM, 10/04/2008
Giffels has a firm grip on the obvious.
akron, oh
Posted 08:22 AM, 10/05/2008
Of course, giffels never bothers to do the real reporting and determine what this woman did with all the money she was given - and now does not have to pay back. More liberal 'cry-me-a river' from the Beacon. No wonder there subscribers are leaving in droves. My guess is the Beacon will be gone in a few years.
