In the wake of the financial crisis, HUD established the Dirtressed Asset Stabilization Program. Unfortunately, this program has allowed many of these loans to be sold to hedge funds and private equity firms, rather than nonprofits.
1. What have the private equity firms done that Senator Warren is rallying against?
2. How many distressed loans have been sold by HUD since 2010?
3. Explain what rental backed securities are.
4. Why do investors without ties to a neighborhood pose risks to a local housing market?
Staff (2015). Elizabeth Warren protests sales of distressed home loans to Wall Street.
Aljazeera America, Sep. 30 (Retrievable online at http://america.aljazeera.com/articles/2015/9/30/warren-protests-hud-sales-mortgages-to-wall-street.html)