CRL’s connection to the housing crisis
October 6, 2008 | Center for Responsible Lending, industry, industry critics | Comments (0)From today’s Washington Times:
But in 1995, the Treasury Department issued new CRA regulations that would make it much more difficult for banks to get a satisfactory CRA rating. These institutions would have to demonstrate that they were investing more money in poor, higher-risk neighborhoods if they wanted federal approval to merge. Much of that money they invested went to ACORN and other left-wing nonprofit groups who prided themselves on making loans to persons with poor credit and little to no savings. Meanwhile, by the late 1990s, Fannie Mae, the nation’s biggest underwriter of home mortgages, came under pressure from the Clinton administration, the banking industry and mortgage companies to make more loans to subprime borrowers. If Fannie fails, “the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry,” American Enterprise Institute scholar Peter Wallison warned in 1999.
“Other left-wing nonprofit groups” includes Center for Responsible Lending’s founder & partner-the SELF HELP Credit Union– which made $4.5 billion in mortgages and sold them off to Fannie Mae which repackaged them to sell to Wall Street,
Comments»
No comments yet.