Ethics in the Mortgage Lending Business - 1566 Words

Ethics in the Mortgage Lending Business In America each person believes it is his or her right to own a home. Banks believe they should give each person the money to finance a home. Countrywide was at the forefront for many years in providing loans to consumers. Their ethics were placed into question when homeowners started losing homes after 2006. Bank of America intervened to assist on home loans affected. Their strong code of ethics, team values, and guiding principles ensured clients that their loans would be secured. Ethics During the time prior to the mortgage crisis, the economy was looking good to the mortgage brokers and lenders in the United States as well as new homeowners. After all, it is the ‘American Dream’ to own a†¦show more content†¦Bank of America s company philosophy is â€Å"we believe, very simply, that it is the actions of individuals working together that build strong communities ... and that business has an obligation to support those actions in the communities it serves† (Lewis). As stated on their company website overview, Bank of America is committed to creating meaningful change in the communities they serve through their philanthropic efforts, associate volunteerism, community development, and investing, support of the arts, and environmental initiatives (Bank of America, n.d.). Their neighborhood revitalization and stabilization programs were designed to aid, restore, and invigorate communities suffering from the growing number of foreclosed and vacant properties. They are further committed to cost-efficient and environmentally sustainable practices that benefit the global community. An example of this is the Bank of America Tower in New York City, one of the world s most environmentally-friendly skyscrapers. Bank of America expects and actively encourages its employees to act ethically, honor Bank of America’s code of ethics, care about one another, and value their communities. Core Values Bank of America core values were established to ensure the team of employees is serving their customers’ needs. The five core values are short but strong in words. Established by Bank of America to ensure confidence in consumer’s relation, the five values are:Show MoreRelatedThe Subprime Loan Blog Assignment And References Of Resources Researched Essay1390 Words   |  6 PagesStates starting somewhere around the middle of 2006. Gilbert (2011) state many levels of contributors participated in this mortgage lending crisis. Gilbert (2011) portends some of these included loan applicants, mortgage brokers, lenders, individual mortgage packagers, agencies that rate mortgages, investment brokers, and advisers, and purchasers of the collateralized mortgage obligations (Gilbert, 2011). People are advised to establish credit early in life to be able to buy homes and automobilesRead MoreCase Study : The Financial Crisis1084 Words   |  5 PagesEnterprise and Social Responsibility Renato Passos 21271774 Assignment 1 – Case Study: The Financial Crisis The purpose of this case study is to provide an introduction to business ethics. The first section of the assignment is an overview of the stakeholders. The second part is the description of an utilitarian perspective and how it should be applied on the case study. This is followed by the definition of the three ‘maxims’, clashes of rights and two normatives theories examined and appliedRead MoreWas the U.S. Federal Government’s 1932 Intervention in the Market for Home Ownership Desirable? How Did the Creation of Fannie Mae in 1938, Ginnie Mae in 1968, and Freddie Mac in 1970 Expand Homeownership and Shape1161 Words   |  5 PagesWas the U.S. federal government’s 1932 intervention in the market for home ownership desirable? How did the creation of Fannie Mae in 1938, Ginnie Mae in 1968, and Freddie Mac in 1970 expand homeownership and shape lending practices at banks and other mortgage lending firms? Yes, I do believe that the U.S. federal government’s 1932 intervention in the market for homeownership was desirable, not only for the government but also for potential home owners as well as those in construction, etc. PriorRead MoreDiscuss the Importance of Ethics in Business in Light of the Recent Global Financial Crisis (Gfc)1119 Words   |  5 Pageson the collapses on issues such as immoral practices, governance, regulations, enterprise ethics. Factors to consider with the collapse that lead to the financial crisis is the dangerous outcomes that financial companies were not foreseen in advanced of borrowing mortgages for the companies. The change of ethics through enterprises demonstrate how business approaches to ethics over the past years where ethics is seen in different perspectives. Lessons are learnt from financial failures in the lackRead MoreSubprime Lending1295 Words   |  6 PagesDefining Subprime Lending The problem to be investigated is the effect of subprime mortgage loans on the economy. According to Merriam Webster subprime is defined as having or being an interest rate that is higher than a prime rate and is extended especially to low-income borrowers; extending or obtaining a subprime loan (Webster, 2012). Subprime mortgage loans are loans given to people with a low credit score. Subprime borrowers normally don’t qualify for prime loans or prime lending. AccordingRead MoreThe Transformation Of Housing Discrimination Toward African American1750 Words   |  7 Pagesdiscrimination especially from the pre-stage application lenders. Home Owners’ Loan Corporation (HOLC) and Fair Housing Administration (FHA) are the roots to create housing discrimination toward minority especially for African American; they help the mortgage lender to make excuses to deny the loan to African American because they do not meet the requirements. During 1928, there was a huge crisis in stock market and caused many banks close and people faced foreclosure. In order to respond the crisis,Read MoreCountrywide Financial : A Large Diversified Financial Service Provider1018 Words   |  5 Pagesfinancial service provider. They operate in five business segments, those being mortgage banking, banking, capital markets, insurance, and global operations. Countrywide was the largest market share among U.S. mortgage originators before unethical actions caused the downfall of the firm. Problems in Countrywide’s loan practices were evident. After the financial crisis of 2008 Countrywide was found to be a significant contributor t o the subprime mortgage debacle. Bank of America was in a position toRead MoreMoral Ethics And Values Based Dilemmas871 Words   |  4 PagesMoral ethics and values-based dilemmas are ethical principles that difficult to handle at a workplace when employees have to choose what is wrong and right according to their own ethics. An effective ethics program must complement the values of the organization along with the values in the law. Good ethical behavior for any business is always a fundamental to its success. The main key for business owners and managements is to ensure all employees understand all the ethics. This paper discusses howRead MoreTaking a Look at the Great Recession782 Words   |  3 Pages In 2007, the bursting of the housing bubble of the U.S was at its peak. The bursting resulted in plummeting of security values tied to the U.S. real estate pricing. The complex interplay of policies that provided easier lending of loans, overpricing of sub-prime mortgages, on a theoretical basis that the prices would continue to increase, and inadequate capital holdings from insurance companies and banks to back their financial commitments contributed to the bursting of the bubble (BoatrightRead MoreCountrywide Home Loans ( Countrywide Hl )1466 Words   |  6 PagesCountrywide Home Loans (Countrywide HL) provide, service, and sell mortgage loans and after-loan services such as collections and payment processing. As a leader in the mortgage industry, they provide these products and services to homeowners through prime and subprime mortgage loans and subsequently resell these loans to investors. In 2009, the United States (US) Treasury Department (Treasury) invested (i.e., US taxpayer -based funding) in Countrywide HL under the Treasury’s 2009 Troubled Asset Relief