This is the first I've heard of this novel foreclosure defense.

Largo's Linda Soronen, sued in December by her lender for foreclosure, is counter-suing by claiming her fast-and-easy home loan arranged in 2006 constituted a "dangerous financial product."

Taking a page from product liability laws, Soronen argues that Wachovia Bank peddled a defective product when it approved no-documentation home loans for barely qualified borrowers.

Those tainted loans, made without reference to a borrower's tax forms and pay stubs, ultimately backfired on the nation's financial system, costing taxpayers hundreds of billions of dollars.

In 2006, Soronen borrowed $162,000 from World Savings Bank, a California lender known as a top purveyor of no-doc loans. Wachovia bought World Savings in 2006. At the time of the loan, Soronen was a "partially disabled, unemployed 57-year-old nurse with no income."

Soronen is seeking class action status and wants her loan voided. She's also seeking $10 million in punitive damages, money that would go to the state.

I don't know if shoddily-approved mortgages rise to the level of faulty automobile accelerators, lead-based paint or poisoned oysters. But they certainly cost the public a lot more.