Originally posted by normbenign
1. I agree with, both parties sell the other as evil.
2. George W. Bush was a leftist. Many of his incentives were really those of Ted Kennedy, and other leftists.
3. Let's keep it apples to apples. Sure the IRS was probably wasteful before Obama, but probably wasn't as intrusive or political. Whether Iraq was wasteful, is another question. Was lts and flaws, but the size and scope of government. Sadly both parties contribute to this.
norm: the Community Reinvestment Act which actually was the impetus for crashing the real estate market in 2008?
You know this isn't true; why keep repeating such a brazen lie?
EDIT: Our study concludes that CRA Banks were substantially less likely than other lenders
to make the kinds of risky home purchase loans that helped fuel the foreclosure crisis.
Specifically, our analysis shows that:
(1) CRA Banks were significantly less likely than other lenders to make a high cost loan;
1
Testimony of Federal Reserve Board Chairman Ben S. Bernanke on Subprime Mortgage Lending and Mitigating
Foreclosures, before the Committee on Financial Services, U.S. House of Representatives, September 20, 2007.
2
In computing the lending performance of a CRA Bank, only loans originated by the bank are included. While a
bank has the option of including affiliate lending in its CRA assessment (12 CFR §228.22(c)), only direct lending
must be assessed. We note, however, that the conclusions of this report would not be affected by including affiliate
lending in the lending performance of CRA Banks. TRAIGER & HINCKLEY LLP
501FIFTH AVENUE · NEW YORK, NY10017 ·(212) 752-1161 ·www.traigerlaw.com 2
Please also view our related 2009 report The Community Reinvestment Act of 1977: Not Guilty
(2) The average APR on high cost loans originated by CRA Banks was appreciably lower
than the average APR on high cost loans originated by other lenders;
(3) CRA Banks were more than twice as likely as other lenders to retain originated loans in
their portfolio; and
(4) Foreclosure rates were lower in MSAs with greater concentrations of bank branches.
Discussion
(1) High Cost Loans
High cost loans3
are a primary driver of the foreclosure crisis, as borrowers who are
unable to afford their mortgage payments default on their loans. There is a very high statistical
correlation (0.816) between the proportion of lending that is high cost and the foreclosure rate in
the MSAs analyzed.4
Default rates are expected to rise in 2008, as monthly payments increase
on mortgage products that permitted borrowers to pay lower “teaser” rates for the first few years
of a loan.5
• All Borrowers
Unlike other lenders, whose market share of high cost loans in the 15 most populous
MSAs was greater than their overall market share,
CRA Banks had a significantly lower market
share of high cost loans than of all loans.
77.2%
22.8%
90.8%
9.2%
All Loans All High Cost Loans
CRA Banks Other Lenders
3
For first lien loans, HMDA requires lenders to report the spread between the APR and comparable Treasury yield,
where the spread is at least three percentage points. These loans are deemed “high cost.” 12 CFR §203.4(b)(12).
4
Indeed, in each of the 15 most populous MSAs, CRA Banks were less likely than other
lenders to originate a high cost loan.
Overall, CRA Banks were 66 percent less likely than other
lenders to originate a high cost loan
http://www.traigerlaw.com/publications/traiger_hinckley_llp_cra_foreclosure_study_1-7-08.pdf