Monthly Archives: March 2011

Which Racial Groups Are The Most Likely To Default On Loans?

The hero in Paul Sperry’s new book (The Great American Bank Robbery) on the housing crisis is Peter J. Wallison. Wallison started warning about a crisis in housing back in 1999. Paul Sperry writes: “Native Americans typically default on about … Continue reading

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U.S. Treasury Will Grade Lenders Over Mortgage Modifications

This reminds when the banks got public grades under the Clinton administration over their willingness to abide by CRA (Community Reinvestment Act). It’s a way to bend the banks to the political will. The sanctity of contracts and moral hazard … Continue reading

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Mortgage Brokers Unhappy With Mortgage Loan Reforms

Mortgage brokers got much of the bad press for our housing downturn. They were accused of selling mortgage loans to people with poor prospects of repayment. Mortgage brokers don’t have a skin in the game of mortgage lending. They get … Continue reading

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Exemption Proposed For Mortgage Securities

The exemption would apply to mortgages where borrowers have made at least a 20% down payment. When buyers have made such down payments, they are much less likely to walk away from their homes and to default. Few free market … Continue reading

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New Mortgage Lending Rules

The housing news keeps getting worse. Prices are still falling for housing in major American cities. The number of foreclosures in 2011 is expected to exceed the number of 2010. And we have new regulations on mortgage lending to insure … Continue reading

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The Hero In The Financial Crisis Inquiry Commission

The hero in Paul Sperry’s new book (The Great American Bank Robbery) on the housing crisis is Peter J. Wallison, who writes in the Wall Street Journal today: With the comment period now closed on its proposed rule, the Financial … Continue reading

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The Collapse Of Credit Unions

Is Wall Street to blame for the collapse of five major credit unions? Several of the biggest banks are accused of misrepresenting the risk of mortgage-backed securities they sold. The WSJ reports: Federal regulators are blaming Wall Street’s biggest firms … Continue reading

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Should Banks Own A Stake In The Mortgage Loans They Originate?

One of the causes of the housing crash was that many lenders who made mortgage loans quickly resold them and thus had no stake in those loans getting paid off. Thus, these lenders had a perverse incentive to make as … Continue reading

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Wells Fargo Loses Racial Discrimination Lawsuit

I am sure big banks such as Wells Fargo would be terribly offended by monthly mortgage payments coming in from black people. Oy, they wouldn’t want that? Of course that is ridiculous. If banks can make money lending to minorities, … Continue reading

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Inflation Fears Raise Mortgage Interest Rates

Food and energy prices are soaring, fueling inflation around the Western world and pushing up mortgage interest rates. Marketwatch reports: Mortgage rates rose this week, influenced partly by inflationary data, Freddie Mac’s chief economist said on Thursday. The 30-year fixed-rate … Continue reading

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