To buy or not to buy? New regs just muddy the water more.
Leave it to government to miss the forest from the trees. Requiring a bunch of paperwork will not make the industry safer or sounder. But what could it really do? Undoubtedly, requiring large down payments and minimum credit scores that would really strengthen loan portfolios would run afoul of other credit social engineering such as the Community Reinvestment Act (CRA).
The CFPB regulations will not stop the next meltdown. As Mr. Pinto says, “Booms are fueled by excessive leverage. This rule does little to limit borrower leverage and lays the foundation for the next bust.”