Obama Administration Pressuring Banks to Lower Standards
Here we go again.
Investors Business Daily has been doing important work reporting on how the Obama administration is pressuring banks to lower lending standards so they can make more loans to minority home buyers.
According to the publication:
In the latest move, the NAACP announced Wednesday it was forming a partnership with Bank of America to "advance fair-lending practices" that will help provide credit to "disenfranchised communities that were ravaged by the economic crisis."
Among other things, BofA has agreed to monitor lending policies for their "racial impact" and allow borrowers "the option of selecting a loan that is appropriate for his circumstances."
BofA, which just shelled out $8.5 billion to settle subprime claims, also pledged to "eliminate policies or practices that encourage biased and exploitive behaviors toward borrowers" and to "work with borrowers to prevent foreclosures."
Sure, if the FHA can do it, why can't big banks? The Obama administration last week announced the agency will let delinquent mortgage holders slide a full year on payments before starting foreclosure proceedings.
The Justice Department, meanwhile, has been pressuring lenders to lower their credit standards in order to secure more mortgages for minorities.
As we reported last week, Attorney General Eric Holder has sued several banks based on groundless charges of discrimination. They're now under court order to change their lending policies to qualify more credit-poor borrowers.
They've even been ordered to scrub clean the bad credit histories of minority borrowers who've defaulted on mortgages, thereby allowing them to requalify for loans.
What could go wrong?
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