the rising foreclosure rate, and expectations are that more lawsuits will follow. In the interim, Congress is debating mortgage lending reforms, as are various state legislatures.
In Ohio, which, according to the National Delinquency Survey from the Mortgage Bankers Association, had the highest number of foreclosures in 2005 and 2006, Attorney General Marc Dann is pursuing a range of criminal investigations and civil remedies. “We have literally thousands of Ohioans who have been defrauded by people who were offering mortgages that were too good to be true,” says Dann. But he doesn’t believe that the mortgage lenders are the only culpable parties. “A lot of people profited handsomely from this — the investment bankers, the bond rating agencies, the loan servicing agencies — and at some point I think there ought to be some accountability.”
But experts stress that despite all the negative press it’s important to remember that subprime loans play an important role. Individuals who have tarnished credit should still be afforded the opportunity to own a home and access the wealth building advantages that it provides. As Taylor of the NCRC summarizes: “It’s in all of our interests — whether it’s African American, Latino, Asian, or white — that we have more homeowners who have more of a stake in the community.”
Additional reporting by Cliff Hocker