patrick.net
An Antidote to Corporate Media
1,363,742 comments by 15,736 users - GreaterNYCDude, HANrongli online now
Comments 1 - 3 of 403 Next » Last » Search these comments
Leigh
2009 Oct 16, 2:29am
In order to qualify for CRA credits the loan had to be made w/in a "red-lined' neighborhood. Show me a 'red-lined' neighborhood in Portland, Oregon, Las Vegas, NV, etc. More than half the subprime loans made in the past ten years were done so by private mortgage lenders NOT regulated by CRA.
Ask yourself this, how long has VA and FHA loans been around and to what degree do those loans partake in the market. These are practically zero down and allow for some not so great credit scores.
Leigh
2009 Oct 16, 2:30am
Why wasn't these a housing bubble in Selma and Cuba, Alabama? Wanna talk about poor... ( I chose these particular locations since I have relatives there)
Leigh
2009 Oct 16, 2:34am
So what was the 'reward' for earning CRA credits???? How were the banks 'FORCED' to make bad loans. In the early years, what were the percentage that went bad?
Comments 1 - 3 of 403 Next » Last » Search these comments
YES, the "only" institutions which were regulated by CRA were large commercial banks, BUT that CREATED the DEMAND that small mortgage companies happily filled. CRA loans were bundled as securities and sold all around the world...but the starting point of the entire food chain was the government forcing commercial banks to make unwise loans.
What happens to prices when suddenly MILLIONS of people can now buy the same product? Thats right - bidding wars -and prices skyrocketed, didn't they? With skyhigh prices many conventional borrowers chose Alt-A and Option Arm loans for the following reasons: (1) to get into the house, and (2) cope with skyhigh payments. Other's with equity borrowed in order to buy commercial properties. The cancer spread and it all started with CRA, kinda like when you toss a pebble into a pond - the ripple effect. By some estimates all this housing activity accounted for more than 40% of ALL jobs in the U.S. since 2001. Its ALL inter-related.Â
CRA had nothing to do with housing bubbles in other countries, however all have similar CAUSES to our own collapse. Central government planing, high inflation, and central banks are the involved...and they too are 100% government related - gee what a coincidence. America also has central government planing (gov't intervention), high inflation and The Fed, which create's money out of thin air then loan's it to the gov't, at interest, putting us all in debt, $1.4 BILLION... PER DAY on INTREST payments alone.
Still not convinced that the Community Reinvestment Act is the cause of our housing and economic crash? Ask yourself this: If ALL loans made in the last 35 years required (1) 20% down, (2) a fixed interest rate, (3) prudent lending requirements and (4) no CRA...would we in America have our current economic meltdown?  Abe.
#housing