I would agree. Three years ago before the bubble burst I was seeing insane deals at the closing table. People with marginal credit ratings trying to escape the re-set rate on adjustable rate mortgage, and replacing the mortgages with new adjustable rate mortgages...taking $8,000 or $9,000 in equity out of the house to cover closing costs for each closing.

The new mortgages often had an initial teaser rate of 4% - 5% and a reset rate of 11% in three or four years. When the borrowers questioned the re-set rate they were often told "Don't worry about that. By that time you will have good credit, and we will get you into a 30 year fixed rate mortgage at a good rate of interest."  Subsequently these mortgage brokers and lenders went under, and now these borrowers are left without recourse when the re-set rate comes due.

I think we need judges to scrutinize these lending practices more carefully. There are very few defenses to a foreclosure action, but fraud is a silver bullet.