The lethal Ninja loan - I guess I missed the name
I wrote about ninja loans before, only never called them that. Your typical ninja loan - no income, no assets, no job verification mortgage was the peak of mortgage industry stupidity. Instead of giving money to any street bum, lenders tried to put at least some sort of respectability to the lending process.
I always called the 3 NOs by the rank of stupidity - least stupid isn't to verify one's income as people can have cash flow which is impossible to verify, like a taxi driver or carpenter or someone self employed. Much more stupid was to skip asset verification, as even those with cash jobs or businesses must have some liquid savings. And no income, no asset loans were commonplace in one way or the other. But not to require a perspective borrower furnish a proof of gainful employment was just that - completely idiotic. So it was NINANJ. Of course, the differently spelled loan abbreviation, NINJNA does look like ninja. And just like ancient ninjas, the ninja loans prove to be quite lethal for both - borrowers and lenders.
Mon Aug 18, 2008 06:08PM by Tony | More in Mortgage | Comments (0)
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