Housing Policy Experts Discuss Mortgage Crisis at Democratic National Convention
Thursday, September 04, 2008
Henry Cisneros, former secretary of the U.S. Department of Housing and Urban Development (HUD), spoke at a housing forum at the Democratic National Convention in Denver yesterday. Cisneros, who served in HUD under President Clinton, stated that the housing industry is in a “truly dangerous place” and that significant steps must be taken by the next administration to address the mounting problems.
Joining Cisneros on the forum panel were Marc H. Morial, president and CEO of the National Urban League, and Maurice Jourdain-Earl, managing director of Compliance Technologies. The event was hosted by the Federal Home Loan Bank of San Francisco (FHLBank San Francisco).
Cisneros told the gathering at the Colorado Convention Center that the stakes of the industry's monumental crisis are high because housing “is so embedded in the overall economy,” and the situation “continues to get worst.” With the economy staggering along, Cisneros said the new administration next year will be forced to pass a second stimulus package. He said it must contain measures to deal with the credit crunch that is curtailing investments and lending. “We won’t get the job machine started without credit,” he said, adding that measures must also assist people and communities already hurt by foreclosures, assist those who will be hurt in the future, and increase the supply of affordable rental housing.
Morial agreed, but said an emphasis must be placed on homeownership. He noted that government programs, such as the GI Bill, were the foundation for the growth of the middle-class in the 70s, 80s and 90s. “Homeownership must be a goal,” he said. “The goal for the nation must be to close the homeownership gap between whites and people of color.” Morial also said that any measures aimed at improving the credit situation for banks must also include a national law against predatory lending.
Jourdain-Earl presented the convention audience with a clearer picture of sub-prime borrowers. His company provides technology that analyzes lending patterns across the country. The most recent data determined that while the majority of subprime loans went to non-Hispanic whites, there was a much higher concentration of subprime loans to people of color. “Whites had more sub-prime loans than all minorities combined,” he said, but added that more than 50 percent of the loans to African Americans were sub-prime loans.
Joining Cisneros on the forum panel were Marc H. Morial, president and CEO of the National Urban League, and Maurice Jourdain-Earl, managing director of Compliance Technologies. The event was hosted by the Federal Home Loan Bank of San Francisco (FHLBank San Francisco).
Cisneros told the gathering at the Colorado Convention Center that the stakes of the industry's monumental crisis are high because housing “is so embedded in the overall economy,” and the situation “continues to get worst.” With the economy staggering along, Cisneros said the new administration next year will be forced to pass a second stimulus package. He said it must contain measures to deal with the credit crunch that is curtailing investments and lending. “We won’t get the job machine started without credit,” he said, adding that measures must also assist people and communities already hurt by foreclosures, assist those who will be hurt in the future, and increase the supply of affordable rental housing.
Morial agreed, but said an emphasis must be placed on homeownership. He noted that government programs, such as the GI Bill, were the foundation for the growth of the middle-class in the 70s, 80s and 90s. “Homeownership must be a goal,” he said. “The goal for the nation must be to close the homeownership gap between whites and people of color.” Morial also said that any measures aimed at improving the credit situation for banks must also include a national law against predatory lending.
Jourdain-Earl presented the convention audience with a clearer picture of sub-prime borrowers. His company provides technology that analyzes lending patterns across the country. The most recent data determined that while the majority of subprime loans went to non-Hispanic whites, there was a much higher concentration of subprime loans to people of color. “Whites had more sub-prime loans than all minorities combined,” he said, but added that more than 50 percent of the loans to African Americans were sub-prime loans.
