Political Quotes

“I am here today with some good news. This week the government will fix something that was broken. I know that some people wish to deny that is possible, but hear me out. Five years ago, during the 2008 financial crisis, we witnessed firsthand that the market for home mortgages was badly broken. The fundamental problem was that many lenders issued mortgages without any concern about whether the borrower would be able to repay those mortgages in the long run. Why would they do that? They did it because they could immediately sell the mortgage to another financial institution. If the borrower couldn't pay, that would turn out to be somebody else's problem. We all know what happened next. Millions of these dangerous mortgages were bundled together, sliced, diced, slapped with AAA ratings, and then sold to retirement funds, local governments, and investors all over the country. When borrowers couldn't make their monthly payments, those bundles of mortgages began collapsing, and the effects were felt in every corner of the economy. This Friday, that basic business model will change, thanks to the Consumer Financial Protection Bureau's new mortgage rules. When these rules go into effect, lenders will be able to issue a mortgage only after they determine that the borrower has the ability to repay it. Lenders will no longer be able to make loans they know will blow up and then feed those dangerous loans into the financial system.…”