Research

In our December 2006 study, " Losing Ground," CRL predicted that millions of American households would lose their homes to foreclosures in the subprime mortgage market. "Losing Ground" focused on the direct impact of subprime foreclosures, but it did not attempt to quantify how those foreclosures would affect neighboring homes and larger communities. In other words, it did not address the "spillover" effect where foreclosures themselves would further depress local housing prices. In this report, we estimate how many homes—including families who are paying their mortgage on time—will suffer a...

Recent industry projections are that over eight million families will lose their homes to foreclosure over the next four years. That's one in every six homeowners with a mortgage. If the economy enters a deep recession, the number of homes lost could exceed 10 million. With the housing sector responsible for one in eight U.S. jobs, the flood of new foreclosures will contribute to the growing unemployment rates and further constrict consumer spending. Banks are foreclosing on homes at a rate of approximately 40,000 per week. The failure to stem these losses imposes a cost to the taxpayers every...

Congressman Miller, Congressman Watt, and Chairman Frank introduced the "Mortgage Reform and Anti-Predatory Lending Act of 2007" on October 22, 2007. The proposed legislation addresses many abusive lending practices that contributed to today's foreclosure crisis, including reckless underwriting practices, subprime prepayment penalties, and yield-spread premiums. However, it is critical that the details of remedy and enforcement provisions are strengthened in order to ensure protections are meaningful and that industry participants, including the secondary market, take their responsibility to...

Federal Reserve System's Fifth Community Affairs Research Conference "Financing Community Development: Learning from the Past, Looking to the Future" The best outcomes for consumers require a competitive market, fair opportunities, and a policy framework that makes both possible. The optimization of a policy framework along these lines is often most limited by the quality of information available concerning market realities. Consequently, I would like to preface my remarks by thanking the Federal Reserve, and specifically the Community Affairs Department, for convening this important event to...