Dodd-Frank Keeps First-Time Home Buyers from Qualifying for Loans
April 8, 2015
According to the California Realtors' home ownership affordability report, only 28 percent of Los Angeles residents can afford to buy a home in Los Angeles, due to the combination of low inventory and the fact that the Dodd-Frank Consumer Protection Act made it much more difficult for immigrants and first-time buyers to qualify for a loan.
Here is what has been happening:
- Between 2000 and 2014, Latinos accounted for 65 percent of the growth in the U.S. labor force. Nearly one million U.S.-born Latinos entered adulthood each year, substantially contributing to U.S. labor force growth.
- The State of Hispanic Home Ownership Report for 2014 revealed that Latinos outpaced the 5 percent average gain in home ownership percentage for the decade between 1994 and 2005 by 2 percent.
- From a high point of 49.7 percent in 2006, Latino home ownership has relentlessly fallen to 45.4 percent at the end of 2014. In 2012, it seemed the downtrend might be broken, as Latino net homeownership increased by 347,000. However, over the last three years the rate fell back, and last year the net ownership by Latinos only increased by 54,000.
The Dodd-Frank Wall Street Reform and Consumer Protection Act was passed to restrain banks from making inappropriate loans to risky buyers who could not pay them back. As a result, Dodd-Frank prevents many young people with shorter credit histories from purchasing their first homes.
Source: Chriss W. Street, "Dodd-Frank Hurts Latino and Frist-Time Home Ownership," Breitbart, April 5, 2015.
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