‘Liar loans’ start to make a US comeback

The pitch arrived with an iconic image of the American Dream: A neat house with a white picket fence.

But behind that picture of a $2.95m (€2.64m) home in Manhattan Beach, California, were hints of something darker: Liar loans — toxic mortgages of the subprime era.

Years after the great American housing bust, mortgages akin to liar loans — which were made without verifying people’s finances — are creeping back into the market.