In July 2007, Vijay and Supriti Soni of Corona del Mar paid $440,000 for a home at 2129 W. Civic Center Drive in Santa Ana.
Five weeks later, they resold the house to Javier Hernandez â€“ the family gardener and handyman â€“ for $660,000. That's a 50 percent gain in 38 days â€“ at a time when real estate prices in Santa Ana were plunging.
But the lender that financed both mortgages â€“ Washington Mutual Bank â€“ took a bath. In March of this year Hernandez's loan went into default and in July the bank foreclosed. On the trustee's deed, the bank listed the home's value at $377,137 â€“ $220,000 less than the outstanding loan.
I hope this is not the type loans our president and congress are going to take over any grade school kid could see that this was a rip off. Just taking over all bad loans with my tax money is not right. I do not mind them taking over loans that homeowners interest has went up so high that they cannot afford to pay the payment. The government could lower the interest to workable amount and still make money own them. But to take over loans like the one above is helping a bank recover money that they were stupid enough to loan.