Addendum to: The Community Reinvestment Act: A Welcome Anomaly in the Foreclosure Crisis

Transcription

1 Addendum to: The Community Reinvestment Act: A Welcome Anomaly in the Foreclosure Crisis Relevant Figures Recalculated to Include CRA Bank Affiliate Lending January 14, 2008 Prepared by: Attorneys at Law 880 Third Avenue New York, NY (212) Traiger & Hinckley LLP This study is not intended to provide and should not be relied on as a source of legal advice.

2 NOTE: This Addendum recalculates relevant Figures from Traiger & Hinckley LLP s study The Community Reinvestment Act: A Welcome Anomaly in the Foreclosure Crisis to contrast the lending of CRA Banks and their subsidiaries and holding company affiliates to other lenders. We note that while the recalculation nominally narrows the statistical gaps found between CRA Banks and other lenders, the conclusions of our study still hold even when the loan originations of CRA Banks are combined with those of their subsidiaries and affiliates. All Loan Market Share 2006 Conventional, Owner-Occupied, 1st Lien, Home Purchase Loans in 15 Most Populous MSAs All Loans All High Cost Loans 15.7% 31.4% 69.6% 84.3% Figure 1a 880 THIRD AVENUE NEW YORK, NY (212)

3 High Cost Loans as a Percentage of Total Originations by CRA Banks (including affiliates) and Percent that CRA Banks were less likely to originate high cost loans Atlanta Boston Chicago Dallas Detroit Houston Los Angeles Miami New York Philadelphia Phoenix Riverside, CA San Francisco Seattle Washington, DC ALL MSAs 11.5% 21.1% 5.5% 15.2% 18.0% 24.4% 16.5% 18.2% 7.2% 10.3% 16.7% 12.9% 7.6% 9.4% 14.3% 25.2% 21.7% 22.0% 31.0% 34.6% 33.2% 43.4% 40.1% 39.5% 34.1% 33.7% 44.3% 30.2% 29.8% 30.2% 35.0% 53.8% Figure 2a 880 THIRD AVENUE NEW YORK, NY (212)

4 LMI Loan Market Share 2006 Conventional, Owner-Occupied, 1st Lien, Home Purchase Loans in 15 Most Populous MSAs All LMI Loans All LMI High Cost Loans 17.4% 32.5% 67.5% 82.6% Figure 3a 880 THIRD AVENUE NEW YORK, NY (212)

5 High Cost Loans as a Percentage of Total Originations to LMI Borrowers by CRA Banks (including affiliates) and Atlanta Boston Chicago Dallas Detroit Houston Los Angeles Miami New York Philadelphia Phoenix Riverside, CA San Francisco Seattle Washington, DC ALL MSAs 14.6% 18.9% 4.4% 19.7% 25.1% 8.6% 15.4% 23.2% 5.3% 16.3% 15.8% 13.2% 25.1% 3.0% 23.2% 9.2% 7.7% 16.9% 39.5% 40.0% 32.0% 30.5% 32.8% 30.6% 37.1% 30.9% 30.2% 38.6% 46.3% 45.4% 50.0% Percent that CRA Banks were less likely to originate high cost loans 55.3% Figure 4a 880 THIRD AVENUE NEW YORK, NY (212)

6 Average Rate Spreads on High Cost Loans Originated by CRA Banks (including affiliates) and Atlanta Boston Chicago Dallas Detroit Houston Los Angeles Miami New York Philadelphia Phoenix Riverside, CA San Francisco Seattle Washington, DC ALL MSAs Magnitude of Lower APR for CRA Banks (in basis points) Figure 5a 880 THIRD AVENUE NEW YORK, NY (212)

7 Average Rate Spreads on High Cost Loans Originated by CRA Banks (including affiliates) and Atlanta Boston Chicago Dallas Detroit Houston Los Angeles Miami New York Philadelphia Phoenix Riverside, CA San Francisco Seattle Washington, DC ALL MSAs Magnitude of Lower APR for CRA Banks (in basis points) Figure 6a 880 THIRD AVENUE NEW YORK, NY (212)

8 Proportion of Loans Held in Portfolio All Loans High Cost Loans Loans to LMI Borrowers High Cost Loans to LMI Borrowers Non-CRA Banks All Lenders except Figure 7a 880 THIRD AVENUE NEW YORK, NY (212)