The collapse of a number of subprime lenders is provoking more calls for the government to “do something”…anything. Then again, almost everything does result in such a call these days, but I digress.
Here are some facts, most importantly, that not all sub prime lenders are predatory lenders.
* Subprime lending annually helps make available more than $100 billion in capital to those who otherwise would not qualify for mortgages. As a result, nearly 70 percent of homes in the U.S. are now owned by their occupants;
* Subprime lending and predatory lending are not one and the same, and equating the two in policymaking leads to dramatic negative effects for those seeking to borrow capital;
* The overall rate of default in mortgage lending has not increased — in fact, it is currently lower than it was five years ago; and
* 96 percent of subprime loans mature without default.
Here’s more information you can check out from Heartland Institute for some interesting things you might not hear otherwise.
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