I still think this post suffers from a total lack of understanding of how large and diverse the mortgage industry actually is. The anecdote of “I went to the bank, and this is all the offered me, so I signed� is so stupid it boggles my mind. This is a HUGE market. Go to another bank. Then go to a broker. Then call a national lender. Then try an internet lender. Tell each one of them that someone else is giving you a better deal. If none of them will give you a better deal, there may be a reason other than race.

We did this. We got quotes from multiple banks, we went to the online sites where they “compete”–and the first offer from any lender we talked with was some exotic bullshit. Say, “no, we want a 30 year fixed” and we got talked and talked and talked at about how the lending agent’s pet alternative mortgage is the greatest thing since sliced bread. Until the day we signed our closing papers, the broker we were working with brought STILL up the “well, look what interest rate you could get on an ARM! or this interest-only loan!”

This was 2004, and we were white, with good credit. Insisting over and over again that we wanted a 30 year fixed (and sticking with our own belief that the 30 year fixed was the best loan for our situation, no matter what sales slime got thrown at us) finally got us a 30 year fixed. But it was an absolute pain in the ass to get it.

And frankly, it says a lot that the *first* option offered to people of color with good credit is some sort of BS “exotic” loan, yet if you’re White with the same credit, you’re more likely to get a traditional mortgage.

This is a HUGE market, yes. But it’s also a homogenized market. IOW, there are plenty of places to go and get the same offer.

Minorities preferentially take out these shitty loans? No. That’s the whole point of the data Sheelzebub was citing: minorities who have the same credit scores as white people who get regular loans don’t get offered the lower-cost versions.

Did I say they prefer the shitty loan? I only said what the data said: That they are more likely to get a shitty loan.
Now, can you tell me in the data where it says that minorities don’t get offered the lower cost versions? What does the data *really* say?

I still think this post suffers from a total lack of understanding of how large and diverse the mortgage industry actually is. The anecdote of “I went to the bank, and this is all the offered me, so I signed” is so stupid it boggles my mind. This is a HUGE market. Go to another bank. Then go to a broker. Then call a national lender. Then try an internet lender. Tell each one of them that someone else is giving you a better deal. If none of them will give you a better deal, there may be a reason other than race.

I’ve been thinking about this as a personal responsibility issue since the last time we discussed lending. I still believe that a lot of people get fucked by their sweet-deal mortgage because they try to hustle the house. But the house also lies and cheats, in this case.

Lift the boot of oppression off the throat of the persecuted banking industry and things get crazy. Suit clad grifters move in and all of a sudden one of the most boring stable investments becomes something that looks like it was created by wealthy tweakers.

Ohio, once again, had an actual bank panic in 1985 over the mismanagement of the finances of one S&L chain. We’re all still stuck with an old school vet from the fiasco called the Keating 5: John McCain. Silverado S&L ended up costing taxpayers over a billion dollars, yet Neil Bush is still not in jail.

(And, as I think I mentioned earlier, it’s not just regulation once, but ongoing regulation. Because every time you put a rule in place it’s some bright, well-paid person’s job to figure out how to make more money by finding a way around it.)

The economic situation in the area is only exacerbating the problem. The housing market there is teetering on the precipice, if it’s not in collapse already, and there doesn’t seem to be a solution.

Sheelzebub, are you just TRYING to piss off the Invisible Hand?

You want us all to suffer and die in poverty when the Invisible Hand is driven off to some other country because we dared to bring in “Regulation”?

What are you, some kind of communist?…