Claim: Senator Chris Dodd opined that a 5% down payment requirement “would restrict home ownership to only those who can afford it.”
Example: [Collected via e-mail, May 2010]
Democrats Vote Down 5 Percent Rule
In a bid to stem taxpayer losses for bad loans guaranteed by federal housing agencies Fanny Mae and Freddy Mac,
Origins: One factor that fueled the subprime mortgage crisis of the 2000s was easy access given to home loans for those who were poor risks. As these loans almost inevitably failed, mortgage delinquencies and foreclosures not only rose but spiraled dramatically upwards, seriously affecting banking and financial markets around the world.
Many people believe a tightening of lending practices would keep similar economic collapses in the housing market from occurring again, with one proposed tightening being the imposition of a five percent down payment requirement upon prospective home buyers. However, not everyone believes such a requirement would be the best way to deal with the issue, which leads us to the fictitious quote reproduced above.
Although the debate was real, the quote
publication billed as “A Satirical Look at Recent News,” and appeared as the final item in his
Semi-News is a satire publication, albeit one which draws upon the news of the day.
Last updated: 20 June 2010