The American Mortgage System

Susan M. Wachter is the Albert Sussman Professor of Real Estate and Professor of Finance, The Wharton School; Professor of City and Regional Planning, School of Design; and Co-Director, Penn Institute for Urban Research, at the University of Pennsylvania. Marvin M. Smith is an economist and Community Development Research Advisor at the Federal Reserve Bank of Philadelphia.

Introduction

—Marvin M. Smith and Susan M. Wachter

Part I Crisis: Origins and Solutions

1 The Secondary Market for Housing Finance in the United States: A Brief Overview

—Ingrid Gould Ellen, John Napier Tye, and Mark A. Willis

2 Reasonable People Did Disagree: Optimism and Pessimism About the U.S. Housing Market Before the Crash

—Kristopher S. Gerardi, Christopher L. Foote, and Paul S. Willen

3 Exploring the Determinants of High-Cost Mortgages to Homeowners in Low- and Moderate-Income Neighborhoods

—Michael S. Barr, Jane K. Dokko, and Benjamin J. Keys

4 Implications of the Housing Market Bubble for Sustainable Homeownership

—Paul S. Calem, Leonard Nakamura, and Susan M. Wachter

5 A Framework for Consumer Protection in Home Mortgage Lending

—Kathleen Engel and Thomas J. Fitzpatrick, IV

Part II Community Impact

6 A Profile of the Mortgage Crisis in a Low- and Moderate-Income Community

—Lynn Fisher, Lauren Lambie-Hanson, and Paul S. Willen

7 Constructive Credit: Revisiting the Performance of Community Reinvestment Act Lending

During the Subprime Crisis

—Carolina Reid and Elizabeth Laderman

8 Navigating the Housing Downturn and Financial Crisis: Home Appreciation and Equity Accumulation Among Community Reinvestment Homeowners

—Sarah F. Riley and Roberto G. Quercia

9 The Community Reinvestment Act: Evaluating Past Performance and Reviewing Options for Reform

—Mark A. Willis

Part III Reforming the Financial Architecture

10 Information Failure and the U.S. Mortgage Crisis

—Adam J. Levitin and Susan M. Wachter

11 The Expanding Financial Safety Net: The Dodd-Frank Act as an Exercise in Denial and Cover-Up

—Edward J. Kane

12 A Private Lender Cooperative Model for Residential Mortgage Finance

—Toni Dechario, Patricia C. Mosser, Joseph Tracy, James Vickery, and Joshua Wright

13 Improving U.S. Housing Finance Through Reform of Fannie Mae and Freddie Mac: A Framework for Evaluating Alternatives

—Ingrid Gould Ellen and Mark A. Willis

14 Some Thoughts on What to Do with Fannie Mae and Freddie Mac

—Robert Van Order

15 The Road Not Taken: Our Failure in Redoing the Financial Architecture

—Vincent Reinhart

List of Contributors

Index

Acknowledgments