RECKLESS AND RUTHLESS: Files show how aggressive lenders peddled mortgages borrowers couldn't afford and pursued them when they failed to meet payments | Mail Online

RECKLESS AND RUTHLESS: Files show how aggressive lenders peddled mortgages borrowers couldn't afford and pursued them when they failed to meet payments | Mail Online

Aggressive mortgage lending to high-risk borrowers by a British subsidiary of defunct US investment bank Lehman Brothers at the height of the property boom has been fully revealed for the first time in files obtained by Financial Mail.
These relate to almost 10,000 mortgages advanced in 2006 by Southern Pacific Mortgage Loans. The loans were quickly sold to investors. This process, on a global scale, triggered Lehman's collapse in September 2008 and was central to the banking crisis.
Investors were persuaded to buy mortgages because they would, supposedly, earn a regular income from the interest paid by borrowers, as well as have security over the property. Even before the crisis, SPML raised eyebrows for its lax lending. But the scale of recklessness is made public here for the first time.