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New Study Finds CRA 'Clearly' Did Lead To Risky Lending

hypocritexposer

Well-known member
Democrats and the media insist the Community Reinvestment Act, the anti-redlining law beefed up by President Clinton, had nothing to do with the subprime mortgage crisis and recession.

But a new study by the respected National Bureau of Economic Research finds, "Yes, it did. We find that adherence to that act led to riskier lending by banks."

Added NBER: "There is a clear pattern of increased defaults for loans made by these banks in quarters around the (CRA) exam. Moreover, the effects are larger for loans made within CRA tracts," or predominantly low-income and minority areas.

To satisfy CRA examiners, "flexible" lending by large banks rose an average 5% and those loans defaulted about 15% more often, the 43-page study found.

Read More At Investor's Business Daily: http://news.investors.com/ibd-editorials-perspective/122012-637924-faults-community-reinvestment-act-cra-mortgage-defaults.htm#ixzz2jvACdgr6
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Tam

Well-known member
They didn't happen to do a study on the effects of Obama's lawsuit on Citibank did they?

You know the one, the one that sued Citibank for not making loans to people that gee COULDN"T AFFORD THEY. :roll:
 
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