By DemocracyRules
The crisis in a nutshell:
"In 1977 a Democrat Congress passed and President Jimmy Carter signed The Community Reinvestment Act (CRA), and the ACORN Housing Corporation (AHC) was instrumental in its passage. The U.S. Congress through the CRA compelled banks and lending institutions to make loans to "communities of color" disregarding sound economic and risk guidelines.
CRA encouraged the relaxing of "outdated" risk-management protocols and underwriting obligations by lending institutions. In the name of ending discrimination, no longer were "communities of color" required to provide verification of income, employment, credit history, ability to pay homeowner bills, or down payment.
In response, many banks and mortgage groups bundled trillions of dollars of "subprime" loans and sold them to investors here and abroad. It is these bundled Community Reinvestment Act mortgages, doomed to fail, that are today causing financial strain in U.S. and global financial markets."
Pro Patria
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