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View Full Version : Obama Obama Regime Pushing Banks to Offer Sub-Prime Mortgages


HonestChieffan
05-11-2011, 06:52 PM
POS and his POS followers need to wake the f$$$ up. CRA strikes again. Watch the morons who say it aint so come out.

http://www.businessweek.com/magazine/content/11_20/b4228031594062.htm

(Business Week) — Community activists in St. Louis became concerned a couple of years ago that local banks weren’t offering credit to the city’s poor and African American residents. So they formed a group called the St. Louis Equal Housing and Community Reinvestment Alliance and began writing complaint letters to federal regulators.

Apparently, someone in Washington took notice. The Federal Reserve has cited one of the group’s targets, Midwest BankCentre, a small bank that has been operating in St. Louis’s predominantly white, middle-class suburbs for over a century, for failing to issue home mortgages or open branches in disadvantaged areas. Although executives at the bank say they don’t discriminate, Midwest BankCentre’s latest annual report says it is in the process of negotiating a settlement with the U.S. Justice Dept. over its lending practices.

Lawyers and bank consultants say regulators and the Obama Administration are scrutinizing financial institutions for a practice that last drew attention before the rise of subprime lending: redlining. The term dates from the 1930s, when the Federal Housing Administration drew up maps using red ink to delineate inner-city neighborhoods considered too risky for lending. Congress later passed laws banning lending discrimination on the basis of race and other characteristics. “The agencies have refocused on redlining because, in the wake of the subprime explosion and sudden implosion, they are looking at these disadvantaged neighborhoods and not seeing any credit access,” says Jo Ann Barefoot, co-chair at Treliant Risk Advisors in Washington, D.C., which consults with banks on regulatory issues.

The 1977 Community Reinvestment Act (CRA) requires banks to make loans in all the areas they serve, not just the wealthy ones. A Bloomberg analysis found the percentage of banks earning negative ratings from regulators on CRA exams has risen from 1.45 percent in 2007 to more than 6 percent in the first quarter of this year.

petegz28
05-11-2011, 06:59 PM
He's got out tax $'s to bail them out when they can't pay

FD
05-11-2011, 07:00 PM
OK. So you are worried house prices are going to rise uncontrollably?

Donger
05-11-2011, 07:03 PM
If you can't put at least 20% down, you shouldn't be given a home loan.

HonestChieffan
05-11-2011, 07:10 PM
If you can't put at least 20% down, you shouldn't be given a home loan.

Amen.

petegz28
05-11-2011, 07:20 PM
OK. So you are worried house prices are going to rise uncontrollably?

No. I am worried about these people getting into ARM's they should never be allowed to have and the slightest bit of rise in rates causes a shitball to start rolling downhill. Kinda like what happened just a few years ago, ya know?

HonestChieffan
05-11-2011, 07:22 PM
OK. So you are worried house prices are going to rise uncontrollably?

Has this ever happened? Ever?

Stupid comment.

FD
05-11-2011, 07:24 PM
Wait, there are still some people under the impression that the CRA caused the housing bubble? Are you serious?

petegz28
05-11-2011, 07:30 PM
Wait, there are still some people under the impression that the CRA caused the housing bubble? Are you serious?

Caused it? No. Played a good part? Yes.

If some middle class person gets into houses they can't afford once rates rise a slight bit WTF makes you think a poor person will be able to afford it?

FD
05-11-2011, 07:34 PM
Caused it? No. Played a good part? Yes.

If some middle class person gets into houses they can't afford once rates rise a slight bit WTF makes you think a poor person will be able to afford it?

How much is "a good part"?

petegz28
05-11-2011, 07:41 PM
How much is "a good part"?

Enough not to do it again.


Or are you of the opinion loose lending didn't get us into the trouble we are in?

FD
05-11-2011, 07:47 PM
Enough not to do it again.


Or are you of the opinion loose lending didn't get us into the trouble we are in?

Based on the evidence I've seen, the CRA had almost zero effect on the housing bubble. The loosening of lending standards didn't happen until much later than the CRA, and loose lending was primarily an effect of the bubble rather than a cause (although there existed a significant feedback effect.)

The idea that the type of program described in the OP was responsible for the housing boom is a cheap partisan talking point that has been long ago been debunked.

Jaric
05-11-2011, 07:53 PM
Great idea. It worked so well the last time.

Simplex3
05-11-2011, 07:53 PM
Put a debtor's prison back on the books and I'm cool with banks loaning money to people that can't pay it back. People might think twice about buying crap they can't afford if they had to work as indentured servants to pay it back.