FBI probing the mortgage industry

[Spartan]

IIRC, a lot of subprime lending involved creative ways around having to pay PMI and still buy with no money down.  Much of the crisis, AFAIK, stems from the fact that a lot of available capital  emboldened lenders to loan money to people who didn't really have the financial resources to own homes.

I would have thought these would be exactly the people to require PMI of.

but if they had to pay PMI, they couldn't afford the monthly home cost..it would have priced them out

So, the thinking was "Borrower A can afford this loan, let's make him pay PMI, but Borrower B can't so let's skip it"?

No wonder this such a cluster*fudge*.