Raghu writes: >> Excellent. So lets stop blaming the CRA then for subprime mortgages >> then. At worst, the CRA was ineffective. At best, it helped reduce >> discrimination in availability of credit for minorities.
You go too far. The CRA is an example of how the rules of the game were changed to expand homeownership to people who could not obtain loans under traditional standards (like the ability ot make a 20% downpayment, a solid credit history, sufficient income, etc.). So while I agree nobody forced anybody to make a subprime loan, there was certainly a lot of political and economic pressure to relax standards, as exemplified by the CRA. As the unfairly maligned Mr. Liebowitz points outs, companies like Countrywide that played the new game the best enjoyed the most applause. >> A good case can be made that predatory lending practices were >> borderline coercive. >> http://www.hud.gov/offices/hsg/sfh/pred/predlend.cfm >> >> In general, poor people are easier to coerce and intimidate than rich people. I would point out the irony of arguing that poor peope don't have the capacity to understand the mortgage process, but believing the exact same people are fully capable of owning a home and performing all of the responsibilities that entails. David Shemano _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
