Minority Groups and Bankers Fight New Mortgage Loan Rules

There has been an odd alliance between the NAACP, the National Council of La Raza, a Latino Civil Rights Organization and the American Bankers Association. They all are fighting new rules which will make it more difficult for minority members to obtain home mortgage loans.

The New Rules Make Mortgages Unobtainable for Some

The mortgage crisis had a greater impact on minority homeowners and low income homeowners than the rest of the populous. They were more susceptible to predatory lending practices that involved subprime loans.

The new rules sought by bank and regulators would make it difficult for low income Americans and minority individuals to obtain new mortgages. David Stevens, the CEO of the Mortgage Bankers Association stated, “But now the risk is that we go too far the other way. We still need to be able to make affordable mortgages that don’t just go to the wealthy, who can afford the biggest down payments and who have the most positive credit ratings.” He made these comments based on his organization’s opposition to the requirement that all new prospective homeowners make a 20% down payment. The fact of the matter is that most families who seek to buy a home do not have 20% of the cost of the home to lay out as a down payment.

The re-writing of the mortgage rules requires a delicate balance. During the hay day of the easy mortgages, the subprime crisis was created. We are still dealing with the aftermath of this crisis. Looking forward to home ownership is still, for many, the American dream. The rules in connection with obtaining new mortgages have to be fair and reasonable, and they should not encourage families to purchase homes they can’t afford; however, these rules should not make it impossible for low income families to obtain mortgages.

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We are foreclosure defense lawyers. We help homeowners stay in their homes, even when they’re in foreclosure. We assist homeowners with mortgage modifications and mortgage modification programs that fail to meet their needs.

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