Due Diligence Not Passing Muster as Weapon Against Abusive Lending, GAO Study Suggests
February 27, 2004
While due diligence can help investors in subprime mortgage securities stave off risks, it appears to do little to protect borrowers from bad lenders, a new report by the General Accounting Office suggests. “While due diligence in the secondary market is important, the role that it can play in deterring predatory lending by performing due diligence is limited,” said the GAO.