And some of that was good, but unfortunately what you started seeing were what were called these sub-prime loans.
The McCain ad also accuses congressional "liberals" of showing bad judgment when they pushed for "risky" sub-prime loans and fought against more regulation.
Most people know that the meteoric rise of home prices between 2001 and 2006 had to do with sub-prime loans and mortgage-backed securities.
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Mortgage-backed securities were used in some cases to mask the risk of default inherent within sub-prime loans, and contributed to the real estate crash and recession.
According to a study by the Department of Housing and Urban Development, sub-prime loans are five times as common in black neighbourhoods as in white ones.
ECONOMIST: Lawmakers, state and federal, are mounting an attack
In the financial world, after all we've been through, sub-prime loans are actually making a comeback, as record low interest rates cause investors to chase returns elsewhere.
Another source of hope for victims of predatory lending could come if the securitisation market, which buys lots of sub-prime loans, became more vigilant about whom it buys loans from.
ECONOMIST: Lawmakers, state and federal, are mounting an attack
According to Fannie Mae, the government-sponsored mortgage-lending agency, up to half the people who take out sub-prime loans could qualify for a prime loan, which charges as much as four percentage points less interest, a huge saving over the 30-year life of a mortgage.
ECONOMIST: Lawmakers, state and federal, are mounting an attack
What was worse was that all the big investors and bankers on Wall Street were investing in these sub-prime loans, so they would pour huge amounts of money into the mortgage industry -- nobody was really seeing whether these mortgages were ones that people were going to have the salary to sustain.
Obama also secured, through his position on the Woods Fund and Chicago Annenberg Challenge boards (he served on the former with Bill Ayers), funding for ACORN's intimidation campaigns against banks that failed to make sub-prime style loans to otherwise ineligible would-be homeowners.
The reason that many sub-prime borrowers do not demand prime loans or shop around for the best sub-prime price is a lack of basic financial knowledge.
ECONOMIST: Lawmakers, state and federal, are mounting an attack
One potential worry is sub-prime lending: loans to people with a bad credit history.
But even after learning about the defectiveness of the loans, Bear Stearns "went on to issue over 30 sub-prime and Alt-A securitisations that included AHM loans", says the attorney general.
Regional banks have also steered clear of the other main area where credit is deteriorating, sub-prime lending (high-interest loans to borrowers with patchy credit).
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If sub-prime borrowers could be helped to make better decisions, says James Carr, head of research at the Fannie Mae Foundation, sub-prime lenders would have to bring rates down, and many would get prime loans.
ECONOMIST: Lawmakers, state and federal, are mounting an attack
It is roughly five years since the US housing market bubble started to deflate, helping to tip the economy into recession and exposing the extent of the sub-prime mortgage scandal in which many people took out loans that they had little prospect of repaying.
The credit-card firm has done much to right itself since 2001, when the economic slowdown hit its sub-prime customers (ie, those considered too risky for mainstream loans) particularly hard and defaults soared.
"I don't expect more bad news from sub-prime positions that we have, but we do have a challenging situation in leveraged loans, " the Swiss-born banker told the BBC.
Providian lent extensively to sub-prime (high-risk) consumers and has been bitten by extraordinarily high charge-offs and delinquent loans.
There was little sub-prime lending of the kind we grew to love here in the states, and non-performing housing loans have remained low, for now.
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