What is the Center for Responsible Lending?
by PubliusOn Wednesday, we brought you the story of a little report from the Boston Fed and its role in creating the housing bubble. In that piece, we mentioned an organization you probably hadn’t heard of before, the Center for Responsible Lending. It is one of the more influential–in a bad way–organizations you don’t know. Over the coming weeks, we’ll lift the veil on this organization. Consider today’s installment a primer.
The Center for Responsible Lending is the most influential liberal advocacy group dealing with the financial services industry in the nation’s capital. It is the policy arm of credit unions based in North Carolina and California. Yes, its parent organization has a vested interest in the outcome of CRL’s advocacy.
The Center performs both public policy research and lobbying. (Lots of lobbying, but that is for another day.) Despite its well known left wing prejudices, the media uncritically accepts the Center’s published papers, giving the group extra heft on Capitol Hill.
The Center aggressively criticizes lending discrimination and pushes lenders to increase their underwriting to poor neighborhood where borrowers are less likely to be able to pay back mortgages. The Center is keenly interested in the redistribution of wealth and cares little about the financial safety and soundness of the banks it targets.
Lenders who fail to cooperate with the Center are accused of “redlining,” i.e. illegally discriminating against borrowers in low-income neighborhoods.
Redlining is a scarlet letter banks are desperate to avoid having pinned on them so they go out of their way to appease the various anti-capitalist shakedown groups including but not limited to National Council of La Raza, ACORN, Neighborhood Assistance Corporation of America (NACA), Greenlining Institute, National Action Network (Al Sharpton), and Rainbow/PUSH Coalition (Jesse Jackson).
At the same time as the Center scolds banks that supposedly don’t lend enough money in poor communities, it also excoriates lenders it considers to be involved in so-called predatory lending. Of course, the Center defines what it considers “predatory.” Lenders are damned if they do, and damned if they don’t.
The Center is headed by liberal crusader Martin Eakes. In 2008 Politico referred to Eakes as the “main intellectual engine driving Democratic responses to the housing crisis.”
The Center’s primary benefactors over the years have been the subprime mortgage speculators Herb and Marion Sandler who have given the nonprofit at least $20 million.
Unlike higher profile high-dollar liberal donors such as George Soros and insurance tycoon Peter B. Lewis (his company is called Progressive for a reason), the Sandlers have received very little media attention. They shelled out $13 million to left-wing groups in a failed effort to prevent President Bush’s reelection in 2004. This made them the third most generous donors in 2004 behind Soros ($27 million) and Lewis ($23 million).
The Sandlers have also given sizeable chunks of cash to the highly influential Center for American Progress, the liberal “action” tank run by Obama transition co-chief John Podesta. Incidentally, Podesta’s outfit recently put disgraced former green jobs czar Van Jones on the payroll. Jones is the self-described revolutionary communist forced from office last year when it was discovered that he was a 9/11 truther.
A longtime champion of the discredited Community Reinvestment Act (CRA), the Center refuses to acknowledge the role the catastrophic legislation played in creating the subprime mortgage bubble the showered the Sandlers with billions of dollars in profits. To the leftist ideologues at the Center, more vigorous enforcement of the CRA could have averted the current financial crisis:
“Had regulators leveled the playing field through common sense underwriting requirements and more vigorously enforced CRA requirements instead of allowing a race to the bottom, this crisis would have been averted.”
Email this to a friend | Print |
Share on Facebook
| Tweet this
| 
Follow Us on Twitter
Subscribe via RSS
Got a Tip?
70 Comments
But Obamao doesn't deal with lobbyists!! (sarc)
Just more ammunition to arm the People for the fight against the Progressives!!
Thank you for the research and the informative article…I'm sure this is just the tip of the iceberg! And it's melllllllllllting.
The tentacles of the progressive serpent are so deep in this country…and the average Joe has no clue. Then there are those who love their so called idea of Progress which is nothing less than oppression. I get so overwhelmed at times….
"The Center aggressively criticizes lending discrimination and pushes lenders to increase their underwriting to poor neighborhood where borrowers are less likely to be able to pay back mortgages."
Gee where have I heard that before?
Oh yeah, grameen…….
You are right.
It was the big mega banks that cratered.
The local mom and pop banks, community lenders, with sound lending practices, are still sound, and still lending money.
Nobody is picking up on this, yet.
This dovetails with the thread here:
http://www.businessinsider.com/2008/8/lehman-brot...
Lehman Bros.was brought down by junk paper. The Center for Responsible Lending and the Community Reinvestment Act played a major role, not only in the bad business, but in initially creating the bad business model itself.
Please explain to me exactly how refusing to loan money to someone who is unable to pay it back is discrimination.
Report immediately to indoctrination classes at your local Democratic party headquarters.
Back in 1976 Mr. Dehan, chief officer at the bank where I wanted to buy a house told me,……..
Ralph if yo could put 5 more in you down payment, this house is yours, otherwise look for something smaller.
The man did me a big favor
Why have things deteriorated so much under the auspices "reform"
Yes,…."redlining" was immoral but what these NO lining groups, listed in the above article, have created is worst.
Simple rule: If you cannot afford it, don't sign for it!
When i bought my house (1986) the rule of thumb was 4 to 5 times your annual income, not 6 to10x. Worked for me.
[...] Big Government.com is taking a look in the must-read of the day: The Center is headed by liberal crusader Martin Eakes. In 2008 Politico referred to Eakes as the “main intellectual engine driving Democratic responses to the housing crisis.” [...]
I might be wrong, but I had thought it was the lending practices of the entire banking community (including the small banks) that had led to the sub-prime crisis. It was just that the the large banks and investment houses purchased all the bad debt and rolled it into large funds, which encouraged lenders to provide loans without thought to the risk of default because they knew it would be purchased by someone else and it would not be sitting on there books
I guess he just isn't following the MSM. We will have to send him to the Dan Rather Re-Education Camp (sarc).
Wanna stop redistribution of wealth…stop giving that wealth to the government.
And guess what, the offcial deficit plus unfunded liabilities of USA are about 50 times the annual revenue (ie, taxes) of USA in good times ($2.5 trillion). Sound familiar? The government must have a Dept of Responsible Lending somewhere…..
Yes, but the government is DEMANDING that little banks get on board….The USA will end up with three banks, just like China has…
I think you are partially right.
Fundamentally though, smaller banks are sound, because they know their communities, and have sound fiscal policy and values.
I have several friends in the banking industry who own banks. These are small banks (less than 500 million in size). They all declined TARP funds, and had quite a rough time with the government. It was purely a power grab by the government.
The investment houses (Lehama Bros etc) bought all that garbage paper from all these shade tree mortgage brokers (who prior to the real estate bubble, were aluminum siding salesamen), who bundled the paper and sold it upstream to Wall Street. They then were bundling it into larger lots, guaranteed by Freedie and Fannie and selling it overseas to the Saudis and Chineese. There are some real mad foreigners right about now……..
Read this from Investor's Business Daily. It explains how Carter passed the CRA (Community Reinvestment Act) and how banks were pressured (in some cases ACORN acted as their enforcement arm) into giving mortgages to those who didn't have a hope of paying and how small banks sold those loans to larger banks and so on until there were no more buyers and … also don't forget that Barney Franks' boyfriend was an officer at Freddie Mac and Rahm Emanuel, Obama's chief of staff, was on the board of Freddie Mac while he serving simultaneously as a member of the House of Representatives.
Cosy? Hard to believe? I'll say.
[...] talk later, so I’m kinda rushed – from the fine REPORTERS at Big Government – have YOU ever heard of this group, which fought for the legislation that passed into law, created the subprime mortgage crisis, and [...]
i knew i was making a broad assertion that was way too general. I have managed to forget most the details of what happened over the past 2 years, along with most of my understanding of finance and economic theory. Spent 4 years of college learning about how the financial system should work only to forget most of it and now I am forced to come up with my positions based on the information I get from pundits. Hey does that make me qualified to write financial regulation legislation that puts the future of our financial prosperity in danger?
Apparently the link at IBD was broken. Click here to read the article.
I'd think you'd be head and shouders above them.
Umm, why dont you investigate the tie in to "JOHN EDWARDS" and the Center for Responsible Lending. This started in North Carolina….OH, and guess where John Edwards is from?
Predatory Lending was nothing more than a sexy "buzz word" designed to shift loan originations from mortgage firms to the NON Profit groups. The media bought it hook line and sinker and blames the whole housing crisis on mortgage companies and banks by way of "Pedatory Lending".
Look at most loan defauts, some of the highest default rates are loans tied to Acorn and CRL groups.
I guess sweating bullets is better than eating lead!
All these Progressive think tanks and groups need to answer for their participation in this financial meltdown. Big offices, high salaries, all pushing their agenda's at the detriment of this nation and in part the world. It’s always been simple.. get a job, save your money, and when you save enough money you can buy an affordable house if you choose. This idea that it is a Right to have a car, an education, health care, food, a house, an abortion. The biggest problem we have is that we have way too many people living beyond their ability to pay. Keep it simple stupid!
Another constitutional amendment- NO more loans backed by the tax payers.
I hate to admit my ignorance, but I know a number of individuals who work for Peter Lewis' Progressive Insurance Co. here in Ohio. I only recently discovered the connection between Soros and Lewis. I feel sick every time I pass a Progressive Insur. facility and they are everywhere.
I WOULD ASK ALL THOSE WHO HAVE PROGRESSIVE INSURANCE TO SWITCH INSURANCE CARRIERS AND NOT ENABLE MR. LEWIS' PROGRESSIVE AGENDA.
Free Massa
I agree. We need to start boycotting all these sociaIist saboteurs to the free market system. i woiuld also recommend Disney, GE, and Viacom (CBS) and their sponsors– there are way more of us than there are of them.
.
You start by selling watermelon.
[...] » What is the Center for Responsible Lending? – Big Government [...]
KOOZ!!!!!!!!!kooz……….LMAO…………LMAO…………tears,……can't see keyboard,..still lmao
Great article!
“Had regulators leveled the playing field through common sense underwriting requirements and more vigorously enforced CRA requirements instead of allowing a race to the bottom, this crisis would have been averted.”
Everyone with an inside track knew that. Interestingly enough, Dick Fuld and Leahman Bros is on the news today. Even Charlie Gasparino is singing like a bird.
Everyone knew this was a house of cards, but needed to generate those fees and commissions for the country club memberships.
People like Bwarney Fwank and Chris Dodd are sweating bullets about now……….
If the playing field had been leveled then alot more banks would have gone tits up. We were lucky there are many local banks that were not stupid enough to engage in these foolish lending practices or the economy would have totally tanked.
I've read a few articles about Bear Stearns, flipped through at least 3 books (not too interested in high finance) but none of them answered my question. From what I can gather, the week before Bear's demise, Renaissance – big hedge funds, pulled its money from its prime brokerage -Bear – everyone knew about it. Shortly thereafter, within 1-2 days, Goldman decided it didn't accept Bear as a counterparty on some derivatives. Goldman immediately reversed their position the following day, but by then it was too late as the initial decision had already exacerbated the run – people started pulling out their money from their Bear prime brokerage accounts. Why did Goldman and Renaissance do this…?
http://www.businessinsider.com/the-bear-stearns-b...
Thanks Publicus. I'm glad to see Biggovernment looking into some of this stuff. It's been bothering and frustrating me for a while and I don't know enough about it. I'm really interested in following the money though because the UN is like a money-sucking bottomless cavern, the EU don't have much, millionaires/billionaires don't like to spend their own money, as their favorite word is "nonprofit". And China continues to love lending us trillions despite their pretend scolding – what country does that when they know we're in trouble unless they were promised something in lieu perhaps?
Umm, one clue woulod be the name of the company….PROGRESSIVE Insurance!
Other than a giant Cloward-Piven thing, what would prompt these ninnies to support issuance of more bad loans? Soros is betting on failure when it comes to the US economy, and his "companies" are hastening the payday.
The Derek Zoolander Center for People Who Can't Read Good: "What is this, a school for ants?"
Gentle Readers,
the above article is not quite correct. Prof. Van Jones wasn't asked to resign his position with the Obama Administration when it was discovered he was a 9/11 ' truther ', rather, he was forced to resign after he made comments critical of environmentalists for their callous attitudes towards low-income Americans and poor people worldwide.
Prof. Van Jones was right to make those comments, so far as I am concerned.
Kindest Regards to all,
I am,
John Lepant
Brighton
Colorado
MarkG the rules have changed again. I just applied to refinance my mortgage in order to get a lower interest rate. 805 credit score, 25% equity, no escrow, salary over $100K, very little debt, and plenty assets and money in my savings, retirement account and business account. The loan was rejected because I am a small business owner. The lender said that the new Fannie/Freddie regulations required them to reject the loan. True story – happened this month.
[...] » What is the Center for Responsible Lending? – Big Government [...]
One word: Soros He wanted to create a crisis so Obama would be elected and it worked.
This makes my blood boil! Add the word "Green" to your business title and try again. These lefties must be turned out in November.
[...] » What is the Center for Responsible Lending? – Big Government [...]
[...] » What is the Center for Responsible Lending? – Big Government [...]
[...] » What is the Center for Responsible Lending? – Big Government [...]
It is discrimination because the liberals think that the Constitution gives every one has the right to live the same size house and have the same toys that you do regardless if they can actually afford them or not.. Don't you remember "the right to ……. Happiness"
Obviously, you aren't poor enough for the loan. (/sarc)
Exactly. The Dems blame the run at the banks on Bush, but the truth is that it was a deliberate maneuver to get a corrupt puppet elected to the highest office in the land.
The reason big banks fell into this trap is because little banks flew under the radar of those oh so crappy banking and financial committees. Remember all of those mergers? Well those go through the committees, and you can just bet they had requirements, such as those bogus loans to the so called poor, to get those mergers done. Government has interfered into business so much that there is virtually no sector of the economy where you don't have to pay to play.
Anyone else ever notice how these subversive groups take on patriotic conservative sounding names?
Boy this country needs to get back to "Let the Buyer Beware!"
[...] » What is the Center for Responsible Lending? – Big Government [...]
[...] » What is the Center for Responsible Lending? – Big Government [...]
[...] » What is the Center for Responsible Lending? – Big Government [...]
People of this country have been lulled to sleep by the "promises" of politicians, and their covert education agenda. Now we have the fight of our lives at hand if we hope to even pass a remnant of our Constitution to our children.
Our national watchdog, the media, has largely been the lapdog of the progressive politicians and denied the public of the knowledge required to make wise choices in selecting leadership. Had they spent a quarter of the time they spent on digging up dirt on Sarah Palin, the likelihood Obama or three quarters of this appointees would be residing in Washington would be slim to none.
Likewise, had they spent time digging into what really led to the financial debacle, we'd have all known about these organizations and the supports who profited while we had to bail them out.
The small community banks you're referring to are the ones that are actually covered by CRA. 90% of sub-prime lending – the stuff that tanked the economy was done by lenders NOT covered by CRA. Like Countrywide. And Wells Fargo Mortgage Company. and on and on and on. Keep singing that it was CRA. It's just not accurate.
The small community banks you're referring to are the ones that are actually covered by CRA. 90% of sub-prime lending – the stuff that tanked the economy was done by lenders NOT covered by CRA. Like Countrywide. And Wells Fargo Mortgage Company. and on and on and on. Keep singing that it was CRA. It's just not accurate.
[...] » What is the Center for Responsible Lending? – Big Government [...]
[...] » What is the Center for Responsible Lending? – Big Government [...]
[...] » What is the Center for Responsible Lending? – Big Government [...]
It's hard to know anymore what passes for "liberal" these days, the word is tossed around so casually. However, referring to Herbert Sandler as such is the most liberal use of the term "liberal" I have yet found. Sandler co-founded the CRL when he headed World Savings bank, one of the key contributors to the mortgage crisis causing present credit crunch. The CRL has served him and other donors well, appearing as a respected source in every news story about the economic crisis, blaming payday lenders and ATM fees, while the actual perpetrators on Wall Street, like Sandler's World Savings, escape any accountability.
[...] report, written by the left-wing Center for Responsible Lending (CRL), condemned IndyMac’s lending practices. The conclusions in it were drawn entirely from [...]
[...] report, written by the left-wing Center for Responsible Lending (CRL), condemned IndyMac’s lending practices. The conclusions in it were drawn entirely from [...]
Do you have problems with spammers? I also use Blog Engine and I have some nice anti-spam techniques; please Email me if you are interested in an exchange of practices.
[...] What is the Center for Responsible Lending?, 3/12 [...]
[...] we have been working to pull the veil back and expose these organizations, most notably in the Center for Responsible Lending (CRL). As readers may recall, most recently we examined the Center’s alleged lobbying [...]
[...] we have been working to pull the veil back and expose these organizations, most notably in the Center for Responsible Lending (CRL). As readers may recall, most recently we examined the Center’s alleged lobbying [...]
[...] bill contains the same language used by groups like the Center for Responsible Lending in the redlining laws and changes to the Community Reinvestment Act in 1995 for special research [...]
[...] » What Is The Center For Responsible Lending? – Big Government The Center aggressively criticizes lending discrimination and pushes lenders to increase their underwriting to poor neighborhood where borrowers are less likely to be able to pay back mortgages. The Center is keenly interested in the redistribution .. 805 credit score, 25% equity, no escrow, salary over $100K, very little debt, and plenty assets and money in my savings, retirement account and business account. The loan was rejected because I am a small business owner . … Tags: poor neighborhood, where borrowers, center for responsible lending, retirement account, small business owner [...]
i just wanna thank you for sharing your information and your site or blog this is simple but nice article I’ve ever seen i like it i learn something today… Some babies have other requirements, depending on their condition when born….
this was a really quality post. In theory I’d like to write like this too – taking time and real effort to make a good article… but what can I say… I procrastinate a lot and never seem to get something done. Some of these very special babies will …
You must be logged in to post a comment.