{"id":31573,"date":"2018-02-24T18:57:29","date_gmt":"2018-02-24T23:57:29","guid":{"rendered":"http:\/\/olduvai.ca\/?p=31573"},"modified":"2018-02-24T18:57:29","modified_gmt":"2018-02-24T23:57:29","slug":"heres-how-regulators-are-inadvertently-laying-the-groundwork-for-the-next-housing-crisis","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=31573","title":{"rendered":"Here&#8217;s How Regulators Are Inadvertently Laying The Groundwork For The Next Housing Crisis"},"content":{"rendered":"<div id=\"block-zerohedge-page-title\" class=\"block block-core block-page-title-block\">\n<h3 class=\"page-title\"><a href=\"https:\/\/www.zerohedge.com\/news\/2018-02-24\/heres-how-regulators-are-inadvertently-laying-groundwork-next-housing-crisis\"><span class=\"field field--name-title field--type-string field--label-hidden\">Here&#8217;s How Regulators Are Inadvertently Laying The Groundwork For The Next Housing Crisis<\/span><\/a><\/h3>\n<\/div>\n<div id=\"block-zerohedge-content\" class=\"block block-system block-system-main-block\">\n<article class=\"node node--type-article node--view-mode-full\" role=\"article\">\n<footer class=\"node__meta\"><\/footer>\n<div class=\"node__content\">\n<div class=\"clearfix text-formatted field field--name-body field--type-text-with-summary field--label-hidden field__item\">\n<p>Only a few weeks ago, <a href=\"https:\/\/www.zerohedge.com\/news\/2018-02-02\/wells-fargo-loses-top-us-mortgage-lender-title-quicken-loans\">we pointed out<\/a> a remarkable development in the US mortgage market that has significant implications not only for mortgage borrowers, but perhaps the broader economy as a whole: <strong><em>Wells Fargo, formerly America&#8217;s foremost mortgage lender, had seen its share of the market eclipsed by Quicken Loans<\/em><\/strong> &#8211; the Detroit-based, nonbank lending behemoth that pioneered applying for mortgages on the Internet with its now-famous Rocket Mortgage (readers will remember RM&#8217;s celebrity-packed SuperBowl spot).<\/p>\n<div class=\"max-width-video-wrapper\">\n<div class=\"fluid-width-video-wrapper\"><iframe loading=\"lazy\" id=\"fitvid59395\" src=\"https:\/\/www.youtube.com\/embed\/IX3_Aqji4yE\" width=\"300\" height=\"150\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\" data-mce-fragment=\"1\"><\/iframe><\/div>\n<\/div>\n<p>Many factors (aside from Wells&#8217; own criminality, <a href=\"https:\/\/www.zerohedge.com\/news\/2018-02-02\/first-time-quicken-loans-quarterly-home-loan-sales-surpassed-wells-fargos\">which recently drew a strong, but ultimately meaningless, rebuke from the Fed)<\/a> have contributed to this shift, as <a href=\"https:\/\/www.bloomberg.com\/view\/articles\/2018-02-23\/mortgage-loans-the-market-is-moving-into-the-shadows\">Bloomberg<\/a> points out.<\/p>\n<p>But as it turns out, <strong>the rising dominance of nonbank lenders like Quicken could portend a massive, bad-debt fueled binge reminiscent of the circumstances that led up to the housing crisis<\/strong>. That is to say, a wave of bad debt could create a cascading wave of defaults with repercussions far beyond the housing market.<\/p>\n<p>Considering all the restrictions that Dodd-Frank and other post-crisis regulations slapped on mortgage lenders, one might wonder how this might be possible.<\/p>\n<p><img decoding=\"async\" src=\"https:\/\/www.zerohedge.com\/sites\/default\/files\/inline-images\/2018.02.24foreclosure.JPG?itok=5hp6ofha\" \/><\/p>\n<p>Of course, as <a href=\"https:\/\/www.bloomberg.com\/view\/articles\/2018-02-23\/mortgage-loans-the-market-is-moving-into-the-shadows\">Bloomberg<\/a> explains,<u><strong> instead of making the market safer, regulators are inadvertently enabling the rise of lenders like Quicken who aren&#8217;t bound by many of the rules that restrict banks&#8217; mortgage-lending practices<\/strong><\/u>. As a result, Quicken Loans is effectively free from many of the regulations that have forced some of the biggest mortgage lenders into a period of retrenchment&#8230;<\/p>\n<blockquote><p><strong>Make no mistake, regulators have done plenty to rein in the mortgage business since the 2000s. <\/strong>New rules require that lenders carefully assess borrowers\u2019 ability to pay, and that mortgage servicers &#8212; which process payments and manage other relations with borrowers &#8212; give troubled customers plenty of opportunity to renegotiate their debts before resorting to foreclosure.<\/p><\/blockquote>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Here&#8217;s How Regulators Are Inadvertently Laying The Groundwork For The Next Housing Crisis Only a few weeks ago, we pointed out a remarkable development in the US mortgage market that has significant implications not only for mortgage borrowers, but perhaps the broader economy as a whole: Wells Fargo, formerly America&#8217;s foremost mortgage lender, had seen [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[63,1845,303,2339,18928,18929,6337,6879,827,3650,3892,4318],"class_list":["post-31573","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banks","tag-dodd-frank","tag-fed","tag-mortgages","tag-non-bank-mortgages","tag-quicken-loans","tag-regulators","tag-shadow-banks","tag-united-states","tag-us-federal-reserve","tag-wells-fargo","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/31573","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=31573"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/31573\/revisions"}],"predecessor-version":[{"id":31574,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/31573\/revisions\/31574"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=31573"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=31573"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=31573"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}