Many of the lower-rated bonds issued by XYZ, and by mortgage pools like it, were purchased by C.D.O.'s, the second-order mortgage vehicles, which were eager to buy lower-rated mortgage paper because it paid a higher yield.
The banks — Bank of America, Citigroup, JPMorgan Chase and Wells Fargo — found the foreclosures after regulators ordered them to examine mortgages as part of a multibillion-dollar federal settlement, according to people with direct knowledge of the findings.
Officials said they would also order Northern Rock, the mortgage lender nationalized a year ago, to increase lending.
The solution: give bankruptcy judges the power to order reductions in mortgage principal owed.
It set a floor on mortgage rates and ordered cash-rich state-owned enterprises to stop moonlighting as property developers.
Federal District Judge Joanna Seybert fined Mr. Williams $51,023.03, the amount he earned in commissions from the mortgage transactions, and ordered him to serve six months of home detention.
He used to talk with Mr. Linton three to four times a day to get his marching orders on mortgage pricing and credit standards.
Within an hour of taking office, Trump signed an executive order making mortgage insurance costlier, which CommonDreams called "a punch in the gut to the middle class".
It would give bankruptcy judges the power to order changes in mortgages on primary residences and would protect loan-servicing companies from lawsuits by investors.
The act ordered banks and savings and loans to expand mortgage loans to racial minorities.
