Boston College Journal of Law and Social Justice 

About: Boston College Journal of Law and Social Justice is an academic journal. The journal publishes majorly in the area(s): Supreme court & Loan. Over the lifetime, 65 publications have been published receiving 238 citations.

Quantifying the Tightness of Mortgage Credit and Assessing Policy Actions

Abstract: INTRODUCTIONMortgage credit has become very tight in the aftermath of the financial crisis Although experts generally agree that it is poor public policy to make loans to borrowers who cannot make their payments, failing to make mortgages to those who can make their payments has an opportunity cost, because historically homeownership has been the best way to build wealth And, default is not binary: very few borrowers will default under all circumstances, and very few borrowers will never default The decision where to draw the line-which mortgages to make-comes down to what probability of default we as a society are prepared to tolerateThis Article first quantifies the tightness of mortgage credit in historical perspective It then discusses one consequence of tight credit: fewer mortgage loans are being made The Article then evaluates the policy actions to loosen the credit box taken by the government-sponsored enterprises (GSEs) and their regulator, the Federal Housing Finance Agency (FHFA), as well as the policy actions taken by the Federal Housing Administration (FHA), arguing that the GSEs have been much more successful than the FHA The Article concludes with the argument that if we don't solve mortgage credit availability issues, we will have a much lower per© centage of homeowners because a larger share of potential new homebuyers will likely be Hispanic or nonwhite-groups that have historically had lower incomes, less wealth, and lower credit scores than whites Because homeownership has traditionally been the best way for households to build wealth, the inability of these new potential homeowners to buy could increase economic inequality between whites and nonwhitesI QUANTIFYING THE TIGHTNESS OF MORTGAGE CREDITBefore we can discuss whether mortgage credit is tight or loose, we must be able to measure it objectively Many researchers have looked at the Federal Reserve Senior Loan Officer Opinion Survey,1 while others use the mortgage denial rate as measured by Home Mortgage Disclosure Act (HMDA) data Neither source seems very useful for our purposes The Federal Reserve survey failed to pick up the loosening of credit in 2000 to 2007, although it did pick up recent tightening (Figure 1a) The denial rate using HMDA data is even less useful; it was highest in 2007, suggesting credit was tightest then, when we know that was when it was loosest (Figure 1b) Denial rates confuse supply and demand Although the supply of mortgage credit was very robust in 2007, the demand from marginal borrowers was even greater, leading to a high denial rate in the face of loose creditWe can look directly at the mortgages originated at any point in time to quantify the tightness of mortgage credit However, many different dimensions make up credit risk The most important dimensions include the loanto-value (LTV) ratio, debt-to-income (DTI) ratio, credit score (FICO is the measure traditionally used for mortgages), and whether the mortgage is a traditional product (fixed-rate mortgage with a term of 30 or fewer years, or an adjustable-rate mortgage with more than 5 years to the reset) or a nontraditional product (interest-only loan, loan with negative amortization, 40year mortgage, or hybrid adjustable-rate loan with a short fixed-rate period where the payment is initially low and rises considerably over the life of the mortgage) In 2016, mortgage credit looked very tight when measured by FICO scores and percentage of nontraditional products; it looked much looser when measured by LTV ratios and about average when measured by DTI ratios (Figure 2)So which measure should we be relying on? Li and Goodman (2014, 8-18) constructed a Housing Credit Availability Index (HCAI) that is updated quarterly2 The HCAI measures the ex ante credit risk of the mortgages originated in any given quarter-more precisely, it measures the likelihood that those mortgages ever default, which is defined as ever going 90 or more days delinquent …

To Free or Not to Free: Rethinking Release Orders under the Prison Litigation Reform Act after Brown v. Plata

Abstract: The United States Supreme Court made one of its most controversial decisions in recent memory in May 2011. Brown v. Plata involved a class action by inmates in California who alleged that their Eighth Amendment rights had been violated because overcrowding in the State's prisons prevented access to adequate physical and mental health care. After California failed to comply with previous orders to remedy those conditions, the U.S. District Court for the Eastern District of California ordered the State to reduce its prison population by forty-six thousand inmates. Forced to either affirm the release order and jeopardize public safety or reverse the order and allow continued violation of prisoners' Eighth Amendment rights, the Supreme Court chose the former. Understandably, many questioned the wisdom of both the decision and the Prison Litigation Reform Act, the statute that required it. As a result, the need for prison reform and alternatives to mass incarceration are clearer than ever.IntroductionOn May 23, 2011, the United States Supreme Court upheld a court order releasing forty-six thousand inmates from Californian prisons, but the decision was by no means an easy one.1 So objectionable were the options before the Court in Brown v. Plata, and so grave were their potential consequences, that the justices may have felt themselves reluctant participants in a Hobsonian gameshow.2 Behind door number one lay reversal of the three-judge court's order and continued overcrowding in California's prisons, which was already so acute that it violated the Eighth Amendment's prohibition against cruel and unusual punishment.3 Behind door number two lay affirmation of the release order and assumption of the public safety risks associated with releasing thousands of prisoners.4 The Court's 5-4 choice of this second door leftmany wondering whether a more tenable solution to prison overcrowding might lie behind a third door that eschews the binary construct presented in Plata and instead opts for systemic change in America's criminal justice system.5The option behind door number one was unpleasant indeed.6 Although designed to hold just under eighty thousand prisoners, the inmate population in California's prison system crested at more than one hundred and sixty thousand in 2006, and, as of August 2009, some prisons in the state had populations approaching three hundred percent of their capacity.7 The predictable result of this arrangement was an increase in violence among inmates.8Over time, the overcrowding in California's prisons produced even more pernicious results.9 Prisoners with mental illnesses "languished for months" without access to care of any sort, and the ever-expanding inmate population led to a "four to five-year gap in the availability of sufficient beds" for the proper treatment of such inmates.10 In lieu of adequate personnel and treatment beds, suicidal inmates were often "held for prolonged periods in telephone booth-sized cages without toilets."11 Inmates not fortunate enough to receive even this modicum of care were largely unsupervised.12The plight of prisoners with physical illnesses told a similar story.13 Like the "telephone booth-sized cages" used to hold suicidal inmates, one prison held fifty inmates in a twelve- by twenty-foot cage for nearly five hours while they awaited medical treatment.14 Elsewhere, a prisoner died after his testicular cancer went untreated for seventeen months, and in San Quentin, a prisoner died from renal failure after going three months without receiving a consultation that should have occurred within fourteen days of his diagnosis.15 The severe understaffing that caused these and other deaths was compounded by the lack of basic sanitation, absence of medical equipment, and incompetence of prison medical staff.16 Of particular concern was the spread of communicable diseases which, in light of crowded conditions, amounted to system-wide pestilences. …

Why Cyclicality Matters to Access to Mortgage Credit

Abstract: Virtually no attention has been paid to the problem of cyclicality in debates over access to mortgage credit, despite its importance as a driver of tight credit. Housing markets are prone to booms accompanied by bubbles in mortgage credit in which lenders cut underwriting standards, leading to elevated loan defaults. During downturns, these cycles artificially impede access to mortgage credit for underserved communities. During upswings, these cycles make homeownership unnecessarily precarious for many who attain it. This volatility exacerbates wealth and income disparities by ethnicity and race.The boom-bust cycle must be addressed in order to assure healthy and sustainable access to credit for creditworthy borrowers. While the inherent cyclicality of the housing finance market cannot be fully eliminated, it can be mitigated to some extent. Mitigation is possible because housing market cycles are financed by and fueled by debt. Policymakers have begun to develop a suite of countercyclical tools to help iron out the peaks and troughs of the residential mortgage market. In this article, we discuss why access to credit is intrinsically linked to cyclicality and canvass possible techniques to modulate the extremes in those cycles.

Deadbeat Dads & Welfare Queens: How Metaphor Shapes Poverty Law

Abstract: Since the 1960s, racialized metaphors describing dysfunctional parents have been deployed by conservative policymakers to shape the way that the public views anti-poverty programs. The merging of race and welfare has eroded support for a robust social safety net, despite growing poverty and economic inequality throughout the land. This Article begins by describing the influence that metaphors have on the way people unconsciously perceive reality. It proceeds by examining historical racial tropes for Black families and how they were repurposed to create the Welfare Queen and Deadbeat Dad, the metaphorical villains of welfare programs. It also tracks the demise of welfare entitlements and the simultaneous ascendency of punitive child support enforcement intended to penalize both “absent” parents and families with non-normative structures. Ultimately, this Article argues that the focus on demonizing Black parents in the welfare system has created an obstacle to providing necessary resources to alleviate the suffering of a growing number of poor children of all races, the intended beneficiaries of public assistance. “[P]eople in power get to impose their metaphors.”

Back to the Future of Clinical Legal Education

Abstract: The premier strength of legal education resides in its dual identity as an academic department of a university and a professional school training future practitioners. This dual identity, which gives law school its unique blend of the intellectual and the practical, can support law graduates as the legal profession undergoes a profound restructuring. Traditional classroom education, when focused not on revealing legal doctrine but on cultivating foundational skills of analysis, interpretation, synthesis, and reasoning, will benefit law graduates even in an altered legal practice environment. Clinical education-which engages students in the multidimensional enterprise of representing clients to inculcate a wide range of generalizable skills and public service values-will need to assume a larger role in tomorrow's legal curriculum. Because clinical learning emerges from yet transcends specific, holistic, lawyering contexts, it can enable law graduates to adapt to transformation in the legal profession of the future.IntroductionA Zen Buddhist story depicts a rider on a horse that is galloping at a tremendous pace, as if rushing to an important destination. A bystander shouts out, "Where are you going?" The rider replies, "I don't know. Ask the horse."1In some respects, legal educators are riding that runaway horse. The legal profession is undergoing a seismic shiftand it is difficult to determine exactly where it is headed. There is increasing commentary on the sources and contents of this shift, suggesting that it is animated by changes in social, economic, and cultural forces such as the internationalization of markets, the incursion of technology, and a series of economic and global cataclysms occurring since the turn of the millennium. 2 Even if changes in legal practice were in the offing anyway, these forces have intensified the quantity and the quality of change.If law schools do not want to ride into these changes without a deliberate sense of purpose, if they do not want to go the way of Borders Books-a company closing many of its doors because it was not nimble enough to respond to the technological era3-then it is imperative that they join those who have begun considering what the likely changes in society and the legal profession will mean for the future of legal education. 4 One of the few things that seem certain is that law schools will not weather societal changes comfortably by remaining the same.5 The traditional law school model now appears economically and education- ally unsustainable.6 The emerging concern is that law schools cost too much and deliver too little of what our brave new world requires,7 a scenario that calls on legal educators to rethink the academic enterprise.As with other kinds of challenges, attitude and approach matter. As vexing as it is to reconceive legal education, it is a viable endeavor, especially as law schools already have significant strengths to draw upon in facing the future, even if they need repackaging and reconceptualizing. 8 In the reconstructive process ahead, reformers should ask the following questions: How can legal education survive these profound changes? How can it thrive in the world of the future? And how can it strive to contribute to the ability of the world to thrive in the decades to come? In addressing these questions, there is a strong argument that contextual educational methods-most notably clinical education-will play a leading role in helping law schools of the future to survive, to thrive, and to strive to contribute to meeting society's needs.To avoid the irony of examining the role of contextual legal education out of its context, Part I of this Article examines contextual legal education in general, and clinical legal education in particular, within the overall educational mission of the law school. Part I highlights the role that law school's dual identity, as both a professional school and an academic institution, can play in enabling legal education to navigate the uncharted waters in which we are already immersed. …