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Mortage rate squeeze predicted in 2006-2007


Radio_Guy
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Oh can the left-wing extremists at the WP ever write an article without playing the race card???

analysis of which borrowers have subprime loans found that they were disproportionately black and Hispanic. Whites and Asians were less likely to hold subprime loans

This is interesting

People who will be "stressed" will be those who were unable to refinance before their rates begin rising or whose home prices have fallen so that it becomes too difficult to sell and get out from under the mortgage

Looks like a prediction the housing price bubble is about to "burst".

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Hi Grim-

You're right it is racist. But it sells newspapers- or so they think...

I know the statistic does support the statement in the article, but they make it seem like the Mortgage industry will only loan at sub-prime rates to minorities which is definately not true.

I think that everyone forgets that there are more White Americans on Welfare and difficult in circumstances than Minority Americans.

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More importantly, there is never a substantive discussion about the causal link of minorities having higher interest rates. We could debate the reasons, but it is accepted fact that black Americans are less educated and have less wealth. With less education and money comes less leverage and choice. In reality, it is the higher poverty rate and lower education that is the underlying cause for highe rates. 99% of loan officers aren't racist- but they will generally squeeze what profit they can out of a potential client (this is the market system at work). When you have less leverage, less money, and less choice, you get squeezed much more- end of story. The media can't seem to dig deeper- or maybe they lack a motive to. Controversy sells, even if based on false pretenses.

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  • 2 weeks later...
The media can't seem to dig deeper- or maybe they lack a motive to. Controversy sells, even if based on false pretenses.

Back in the old days, racism was legal in the banking and mortgage industries. They employed so many techniques, like red lining. Banks would mark out certain parts of town (with red lines) and if you lived there, you didn't get a mortgage.

So if you were poor, a minority, even a single mother, you were screwed.

But those days are over and all of those practices are outlawed. In fact, with the Communities Reinvestment Act (CRA), banks are required to devote a certain amount of effort into depressed neighborhoods.

Unfortunately, the media doesn't care. They insert these innuendos without presenting the facts and history to such findings (because it would really become a different story). And it gives the false impression that the "white man" is oppressing me and has been doing so for all these years, which is total [EXPLETIVE DELETED].

In fact, there are still very big segments of minority populations who blame the "white man" for their poverty without attaching any of the own irresponsibility. And stories like this help magify that blame...

Like, it is still the "white man's" fault even though:

1. I didn't graduate high school.

2. I don't hold onto a job long enough.

3. I engage in criminal activity

4. I started a family at 16 or 19, etc...

And gee, I cannot get a mortgage... Yep, its the "white man's" fault...

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