A Spectrum of Mortgage Solutions | Feb 13th at 2:50pm
To oversimplify (which unfortunately follows in the style and substance of David Brooks’ column today), there seems to be two ways to go with offering consumer better mortgages choices: more complex or constraining people’s choices. Is the matter of fixing the mortgage market a matter of managing risk better, as Robert Shiller suggests by having mortgage payments adjust as a home changes in value over time and as household income changes or by subsidizing financial education? Or is it a matter of making it harder to overleverage homes (as Ryan Avent has noted) by banning low down payment mortgages or defaulting people into 30-year fixed-rate mortgages?
I don’t want to offer this as a false choice between the two, but that’s how the discussion seems to have broken down so far. But there is a lot of sub rosa debate here about whether the findings of .(JavaScript must be enabled to view this email address) suggest we should limit people’s choices or offer them “better” choices.
Michael Freedman-Schnapp is a candidate for a Masters in Urban Planning at NYU's Wagner School for Public Service. He is the Senior Policy Associate for the New York Industrial Retention Network, where he works on keeping blue-collar jobs in New York City and encouraging the growth of the local green economy.
