A growing literature suggests that housing policy, embodied by the Community Reinvestment Act (CRA) and government sponsored enterprises' affordable housing goals, may have caused the subprime crisis. The conclusions drawn in this literature, for the most part, have been based on associations...

This paper explores the link between the house-price expectations of mortgage lenders and the extent of subprime lending. It argues that bubble conditions in the housing market are likely to spur subprime lending, with favorable price expectations easing the default concerns of lenders and thus...

Depository institutions may use information advantages along dimensions not observed or considered by outside parties to "cream-skim," meaning to transfer risk to naïve, uninformed, or unconcerned investors through the sale or securitization process. This paper examines whether "cream-skimming"...