Consider this press release from Citigroup in September of 2004, which finds ACORN and Citi happily holding hands and pushing “the goals of both organizations to promote homeownership in low- and moderate-income neighborhoods, especially in immigrant communities.”
From the press statement:
“With this agreement, ACORN will be able to expand our mission of strengthening communities by helping low- and moderate-income families, including new immigrants to this country, become homeowners,” said Maude Hurd, National President of ACORN.
It’s not as if Citi and ACORN were the only ones jumping deep into subprime lending together, either. Economic policy research at the time centered on how lenders were denying loans to those with poor credit, often minorities; consider the following conclusion from a September 1999 study:
The Urban Institute report issued today says that “not all Americans enjoy equal access to the benefits of homeownership, in part because of unequal access to capital.”
“Fair lending” essentially became synonymous with a universal lowering of credit standards — and as lenders loosened credit standards, community groups cheered, and the White House lauded the commitment to “expanding homeownership.”
Legislatively, President Bush went so far as to propose eliminating down payment requirements altogether. In a September 2004 press statement, administration officials touted a so-called “Zero-Downpayment Initiative” that would eliminate the statutory requirement of a minimum three percent down payment for FHA-insured single-family mortgages for first-time homebuyers.
Even when we had clear data suggesting that lending to people who couldn’t afford their loans would likely end up badly, we ignored it. Consider this story from April 2004, which noted a Fannie Mae study that found that 49 percent of English-language Hispanics, 46 percent of Spanish-language Hispanics, and 42 percent of African Americans cited “credit concerns” as the primary reason they had not yet bought a home.
That sense of entitlement has given traction to guys like Bruce Marks at the Neighborhood Assistance Corporation of America, whose boorish tactics would be universally condemned at any other point in our nation’s history. Instead, the use of those tactics get him named “Bostonian of the Year” by the Boston Globe, and find him putting banks in a veritable vise grip — perhaps even rightfully so — over their lending tactics.
You da man! You are right on top of this. Keep me posted and ping me please to other articles. Keyword is CRA.
Mark Levin led off his show talking about this today. So the word is getting out.
The truth shall set you free.