November 01, 2009 SEATTLE — For decades, Washington Mutual lived up to its image as a staid, straightlaced Seattle institution. Its motto: “The Friend of the Family.”
By the time WaMu made history last year as the nation’s biggest bank failure, it bore no resemblance to this homey image. In fact, the bank had become one of the nation’s biggest predatory lenders.
In particular, the bank promoted as its “signature loan” a complex product known as the option ARM. This adjustable-rate mortgage, much like a credit card, gave borrowers the choice of making low minimum payments. But that option didn’t cover the interest and only dug them deeper into debt. FULL STORY
By the time WaMu made history last year as the nation’s biggest bank failure, it bore no resemblance to this homey image. In fact, the bank had become one of the nation’s biggest predatory lenders.
In particular, the bank promoted as its “signature loan” a complex product known as the option ARM. This adjustable-rate mortgage, much like a credit card, gave borrowers the choice of making low minimum payments. But that option didn’t cover the interest and only dug them deeper into debt. FULL STORY
