Misplaced blame

NY Times Editorial, Oct. 15, 2008:In recent weeks, Republicans in Congress have been blaming a lot of things, besides themselves, for the subprime mortgage debacle. And many of these same Republicans have long wanted to abolish the Community Reinvestment Act, a landmark law that helped to rebuild some of the nation’s most desolate communities by requiring banks to lend, invest and open branches in low-income areas that had historically been written off….A study released this week by the Center for Community Capital at the University of North Carolina in Chapel Hill [College of Arts and Sciences} shows that people of similar financial profiles were three to five times more likely to default when they received high-priced subprime mortgages than when they got bank loans made under the Community Reinvestment Act.”

Related research from Roberto Quercia and colleagues at the Center for Community Capital was cited recently in Forbes.

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