No Skin in the Game

Economist Stan Liebowitz reported earlier this month in the Wall Street Journal that newly analyzed data suggests that zero money down mortgages played a much greater role in the mortgage bubble and its collapse than he previously thought.

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From the nearly seven years that I covered housing finance on Capitol Hill (1999 to 2006) I remember Sen. Kit Bond (R-Missouri) warning repeatedly about the dangers inherent in zero- and close-to-zero money down mortgages. In the fall Liebowitz wrote about the destructive effect the Community Reinvestment Act has had on mortgage underwriting standards.