Mortgage Industry: Show Your Work

As a civil rights coalition, we’re obviously concerned about anything that might increase the cost of credit. So when we first heard the lending industry argue that bankruptcy legislation like H.R. 3609 would result in higher interest rates, it got our attention, and it made us want to learn more.

Naturally, and this is especially true of Black and Latino borrowers who were steered into more expensive loans than they needed, interest rates on many mortgage loans are already far too high. That’s one of the main reasons that home foreclosures have skyrocketed in the past year. Can we really believe, at this point, that the mortgage lending industry is really concerned about homeowners’ interest rates?

In an effort to give the industry the benefit of the doubt, we looked at what it was saying about H.R. 3609. According to a number of letters, congressional statements, and other materials from the Mortgage Bankers Association and other industry organizations, bills such as H.R. 3609 would increase mortgage interest rates by 1.5 to 2 percent. But in all of their materials, and for all the rhetoric they are throwing around, we haven’t been able to actually find out how they arrived at those estimates. No studies, no citations, no footnotes, nothing. “Just trust us,

Do you remember in elementary school math classes, when your teachers insisted that you “show your work