my stupid questions about the millions in mortgage loans to Manafort

[garybeck]

forgive me if i have missed some details, but i keep hearing how a bank gave millions in loans to Manafort even though there were red flags.

they never seem to discuss what the loan application said the money was for, and where all that money went.

when you get a mortgage loan, don't you usually have to actually buy some mortgage? doesn't the money usually go from the bank directly to the seller? doesn't the lender do an appraisal on the property? did he actually buy some real estate?

there has to be more to the story about where the money actually ended up. and don't tell me it was all spent on expensive clothing.

[lapfog_1]

1. although I haven't seen the actual loan documents so this is speculation

my guess is that these loans were home equity loans, using the over inflated evaluation of the home or homes in question.

In other words, Manafort bought a house for, say, 1 Million... he either paid cash or had paid down a mortgage on the place... then he ginned up some property evaluations that maybe showed the home to be worth maybe 2 million. He takes this to a bank and gets a loan on the difference (using inflated or false income statements to show how he planned to service the loan).

At this point the bank loans him the full $2M or some appreciable amount of that sum (depending on whether the property had a first mortgage and what their lending practices are). Manafort could do with that amount whatever he wanted... including his extensive wardrobe of expensive suits.

Of course if he hid the first mortgage, paid off people to generate a false evaluation, forged his income statements, etc... he is going to jail for bank fraud. The bank officers face some legal liability as well for possible conspiracy to commit fraud if they personally were to be rewarded (as the one guy that wanted to be Sec Army was) for approving fraudulent loans.

[garybeck]

2. ok but,

first of all, there are $16M in loans, not $2M. that is a huge amount to borrow for a mortgage.

i'm surprised that there are not more details about the loans in the news reports. was it discussed at the trial?

OR, could that be part of the sealed information that is related to an ongoing investigation?

it seems very odd to me that the head of trump's campaign would be getting a loan for millions of dollars in the middle of the campaign and that the money he got didn't have something to do with the election.

me thinks the ostrich suit and other expenses are to cover for where the money really went.

to pay russian hackers per chance?

just speculation but it makes more sense than Manafort grabbing $16M in the middle of the campaign all for personal use, and all that money would have nothing to do with the campaign. that makes no sense.

[better]

4. If my memory serves...

I think I recall something about him being tens of millions in debt to Oleg Deripaska. That, taken in conjunction with his email question about "how do we use (his position in the Trump campaign) to get whole" leads me to believe that's the likely purpose of these funds.

[lapfog_1]

8. the $2m and $1M were mere examples... not having the numbers at hand

and I'm absolutely certain he was using his connection with the candidate and later President to "sell" access (he tried to hide the sale buy structuring these as loans... and avoid taxes... but of course that work work (or at least we hope it won't).

[pnwmom]

3. Part of the issue was that the purpose was a moving target. For example, one of the loans

started out as a construction loan for remodeling, but then was changed to a refinance with cash to Manafort.

Mortgages aren't only available on a property you're buying. You can also get a mortgage on a property you already own, either free and clear or with a prior mortgage -- as long as the bank is comfortable with the total amount owed on the property, and doesn't mind being second in line for payment if there is a default.

And yes, he seems to have wanted the cash to pay his various debts and ongoing living expenses, since he wasn't bringing in millions from Ukraine anymore.

One of your questions connects with what I have been wondering. I think they did do appraisals, but I don't understand why they were relying on Manafort to inform them about prior loans. Why didn't they do a title search to see what the status of the property was? Like in the case of every other mortgage I've ever heard of . . .

[OnDoutside]

5. The other question is how did Manafort get to hear about Calk ? I haven't seen the answer to that.

[blueinredohio]

6. I just hope the bank manager who gave him the loans gets fired.

[Vinca]

7. Apparently he said he was mortgaging more of the value of property. In one case I think he failed

to mention he didn't own the property, but that's why Paulie's in court today. I think he pretty much manufactured all the paperwork he might need to get a mortgage, boosting or reducing numbers as required. In the end, he found one of the dumbest bankers on the face of the earth and made ridiculous promises in exchange for loot. The only thing that puzzles me about this case is why Manafort didn't take a private jet out of this country when he had the chance. Now he's likely to be behind bars for life.