The O.C. Mortgage Bust
Jobs Dry Up In Subprime Heartland
By Dina ElBoghdady
Washington Post Staff Writer
Saturday, October 13, 2007; D01
IRVINE, Calif. — After more than two decades in the mortgage business, Tony Ventimiglio got his big break in 2001 when he accepted a managerial job with a lender here in the heart of Orange County for $225,000 a year — more than double what he had made in each of the previous four years.
Ventimiglio nearly doubled his salary again two years later, this time at the now-defunct Homefield Financial, where he supervised 100 workers, including salespeople who routinely made $25,000 a month in commission.
“When I started working there in 2003, I was embarrassed because I was driving a Cadillac and the young office clerks were all driving Mercedes and BMWs,” said Ventimiglio, 49. “There were a lot of people who knew nothing about mortgages. They were simply in the right place at the right time.”
Embarrassed at driving ‘only’ a Cadillac, while making (I dare not say earning) a half-million a year supervising people who know nothing about mortgages–on behalf of a mortgage lender.
If that has become the definition of ‘right place at the right time,’ then it’s hard to dredge up even a small degree of sympathy for the bust.
What has been largely lost in the crocodile tears about poor people losing their homes, is the simple arithmetic of having to be able to survive a mortgage in order to qualify as a buyer. When lenders encourage mortgagees to ‘pencil in whatever income qualifies,’ whether or not it is real, then low-ball the first two years of interest in order to do the deal–it’s not a real market and shouldn’t qualify as a real crisis.
The housing bubble was never about welcoming the poor into home ownership. It was about packaging off liability to others while pocketing commissions–a scheme by the greedy, overseen by the incompetent.
The Fed stepping into this perfectly logical bursting of a perfectly phony balloon is ludicrous. They falsely cry ‘poor borrower’ in order to support guys who are embarrassed by their Cadillac in a BMW culture.