Fleckenstein Wants to Bring Back Regulation X
Reg X seems a little extreme. Additionally, I doubt Congress would ever summon enough courage to bring back this type of Regulation.
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"Greenspan is certainly not leading a charge to take any action to thwart the housing bubble. If he was serious, he could ask Congress to resuscitate Regulation X (part of the Defense Production Act, passed in September 1950), which empowered the Fed to set minimum downpayments and maximum mortgage-repayment periods for residential properties. (However, the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) have come out against perceived abuses in mortgage lending, citing interest-only and negative-amortization mortgages.)"
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Snip...
"Greenspan is certainly not leading a charge to take any action to thwart the housing bubble. If he was serious, he could ask Congress to resuscitate Regulation X (part of the Defense Production Act, passed in September 1950), which empowered the Fed to set minimum downpayments and maximum mortgage-repayment periods for residential properties. (However, the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) have come out against perceived abuses in mortgage lending, citing interest-only and negative-amortization mortgages.)"
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posted by Little_Silvered at 10:27 PM
1 Comments:
I don't see what is wrong with Reg X.
20% down and 30 year max is still
pretty good financing deal, assuming price levels would be somewhat lower.
No no-doc loans please.
No NINA (no income no assets) loans please.
No piggyback loans please for down payments less than 20%.
It does not have to be introduced all at once to crash the market,
but gradually over 2 or 3 years for example.
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