I was reading this article in the Globe today about increasing foreclosure rates in Massachusetts, fueled by subprime lending to low-income, minority communities. How terrible!
I hope to start volunteering for Jamie Eldridge soon, in part because I know he’s done some work with this. He was a legal aid attorney and he’s sponsored some legislation on it too. Hopefully we’ll hear from him soon!
Does anyone know if other congressional-candidates-to-be have worked on this?
Update, from Charley: Raj points us to this article by Anya Kamenetz, author of “Generation Debt”:
America is at another Enron moment. Rather than shedding a tear for the traders who pumped up this market, we are now required as a country to reexamine the responsibility that creditors have to borrowers-to make a sane assessment of the ability to repay, not merely to make as much money as they can out of the risk. It is high time to block predatory lending of all kinds by reinstating usury laws, limiting interest rates, penalties and fees that creditors can charge.
Will our Democratic lawmakers accept this moral challenge? The jury’s still out. On the one hand, 14 Democratic senators voted for the credit-industry-authored bankruptcy bill in 2005. On the other hand, Senator Carl Levin, D-Mich., recently held some pretty harrowing hearings on predatory credit card industry practices, in which he raked over the CEOs of the top three credit card issuers in the country.
Several lawmakers, including Ted Kennedy, D-Mass., and Hillary Clinton, D-NY, have introduced reforms of the extremely predatory practices of student lenders. And Senator Chris Dodd and Representative Barney Frank, D-Mass., are each discussing introducing legislation on subprime lending, Dodd to protect the borrowers already trapped and Frank to restrict these risky mortgages going forward.
I have high hopes that predatory lending could become the moral values issue of 2008. In the meantime, let’s keep in mind who the real casualties are.