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Posted by: nostalgia 1 year, 1 month ago
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nostalgia1 year, 1 month ago
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Barack Obama along with others sued Citibank on behalf of ACORN in 1995 claiming the bank was not making mortgages to poor and minorities
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The Chicago Sun-Times reported an initiative led by ACORN's Talbott with five area lenders "participating in a $55 million national pilot program with affordable-housing group ACORN to make mortgages for low- and moderate-income people with troubled credit history
ACORN went to Congress to protect the CRA from GOP reforms and to expand the reach of quota-based lending to Fannie, Freddie and beyond. What resulted was the broadening of the "acceptability of risky subprime loans throughout the financial system, thus precipitating our current crisis."-
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willottica1 year, 1 month ago
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What was the lawsuit over again? Was it because they weren't making mortgages to poor and minorities? Or because they refused mortgages to minorities with identical incomes as mortgages they approved to non-minorities. Or they did this based on the neighborhood.
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I suggest you look into the exact reasoning of the lawsuit before claiming it was just because poor and minorities couldn't get loans (with the implication that they were too risky to lend to).
Maybe the lawsuit went the wrong way - maybe the result should have been rescinding the mortgages of the risky white borrowers. The lawsuit was over racism and discrimination, which there was evidence of, not because the banks were refusing to give bad loans.-
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willottica1 year, 1 month ago
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That's actually the way they are in Canada. :-) (Though 5% down mortgages are still available, but you must buy default insurance for <20% down.)
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You need verified income, your mortgage can be no more than 30% of that income, with your total debt obligations no more than 40% of your income.
"Credit checks" are a bunch of BS, in my opinion. The credit score is far too dependant on what others have been willing to lend you, and too little on what you actually repay, and bad marks hurt your rating for too long.
I also disagree with your down-payment idea. Unless rental rates are significantly lower than mortgage rates, it can be very difficult to save for a downpayment and pay rent. I support low-downpayment options, but would make it illegal to walk away from an upside-down mortgage. No debt forgiveness. And if you were to walk away, then you should never be able to qualify for a mortgage again (at least until you paid back the debt you left behind).
Your score is better if you owe 10-20% of your debt potential than if you owe nothing. Furthermore, someone with "bad credit" should not be forced to pay higher interest rates (which may then cause their credit to worsen). The credit score system is set up to reward those who need credit the least, and punish those who need it the most.
As posted below on this thread, I think it is wrong to charge different rates based on credit scores (though the total amount loaned SHOULD be dependant on the score plus income security).
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