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Monday, December 29, 2008

The EASY Mortgages

By PETER S. GOODMAN and GRETCHEN MORGENSON
Published: December 27, 2008
“We hope to do to this industry what Wal-Mart did to theirs,Starbucks did to theirs, Costco did to theirs and Lowe’s-Home Depotdid to their industry. And I think if we’ve done our job, five years from now you’re not going to call us a bank.”


SAN DIEGO — As a supervisor at a Washington Mutual mortgage processing center, John D. Parsons was accustomed to seeing baby sitters claiming salaries worthy of college presidents, and schoolteachers with incomes rivaling stockbrokers’. He rarely questioned them. A real estate frenzy was under way and WaMu, as his bank was known, was all about saying yes.

Yet even by WaMu’s relaxed standards, one mortgage four years ago raised eyebrows. The borrower was claiming a six-figure income and an unusual profession: mariachi singer.

Mr. Parsons could not verify the singer’s income, so he had him photographed in front of his home dressed in his mariachi outfit. The photo went into a WaMu file. Approved.
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