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Mortgage Programs Drying Up Like 2008, But For Completely Different Reasons

Posted To: MND NewsWire

A paper written for the Joint Center on Housing Studies at Harvard University focuses on the causes and effects of mortgage credit tightening in the current COVID-crisis. The author, Don Layton, is a former CEO of Freddie Mac and a Senior Industry Fellow at the Center. One of the biggest pandemic-related issues to emerge in housing finance is the availability of credit. Tightening is being discussed as a major problem, perhaps on a par with the last financial crisis. The implication seems to be that much if not all of that tightening is illegitimate, a failure of government policy that could be avoided with the right actions that do not require subsidies for small business or specific industries. Layton questions this view and examines how mortgages are made today and who sets the credit standards…(read more)

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