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[Dancing David]

You don't seem to understand the issue at all. There is no such thing as a "CRA loan". The CRA simply requires that a mortgage lender must issue loans across all income levels in the community in which they're located - regardless of the pool of credit-worthy customers. You can't point to loans the bank made and say "that one was a CRA loan, this one was not". What you can do is look at foreclosure rates in areas in which the CRA required loans to be made - and these areas have far higher foreclosure rates than areas not targeted by the CRA.

What we do know is that the mortgage securities collapse is caused by loans that have defaulted and are in foreclosure, and that the foreclosure rates in areas targeted by the CRA are far higher than in other areas.

Um, one simple questions which I will give you two days to answer;

1 What percentage of sub-prime loans were generated by non-depository institutions not covered by the CRA?
2 (Bonus question) What percentage of sub-prime borrowers could have qualified for a prime loan?

Your insistence that the CRA is the responsible factor in sub-prime loans seems rather uninformed and based upon a dogma.

 

[Dancing David]

http://en.wikipedia.org/wiki/Community_Reinvestment_Act#Original_Act

The Community Reinvestment Act (or CRA, Pub.L. 95-128, title VIII, 91 Stat. 1147, 12 U.S.C. § 2901 et seq.) is a United States federal law designed to encourage commercial banks and saving associations to meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods.

Here is a source on who the top ten originators of sub-prime loans are (ignore the editorial, it is the box on the left that has the data)
http://www.marketwatch.com/news/sto...x?guid={100602BA-13D5-4B8C-BEB6-D5547594D449}

More than half of subprime loans were made by independent mortgage companies not subject to comprehensive federal supervision; another 30 percent of such originations were made by affiliates of banks or thrifts, which are not subject to routine examination or supervision, and the remaining 20 percent were made by banks and thrifts.

http://www.house.gov/apps/list/hearing/financialsvcs_dem/barr021308.pdf

Moody's Investors Service recently surveyed 16 mortgage servicers that accounted for 80 percent of the market for subprime loans made to borrowers with shaky credit histories.

http://www.newsweek.com/id/61537?tid=relatedcl



More here
http://www.traigerlaw.com/publications/traiger_hinckley_llp_cra_foreclosure_study_1-7-08.pdf

So lets us see: 25% or less of sub-prime loans are originated under the CRA?