Calls For Foreclosure Moratorium In Wake Of Subprime Meltdown

As the subprime mortgage crisis worsens, civil rights organizations and Democratic presidential contenders alike are calling for a moratorium on foreclosures, but the mortgage industry is resisting.

1 minute read

April 8, 2007, 11:00 AM PDT

By Michael Dudley


"As interest rates have climbed and the housing market has slumped, the number of what are politely called 'delinquent' loans has soared. And as home repossessions grow, civil rights groups and presidential contenders alike are stepping into the row over the high risk, or subprime, mortgage market."

"In the most sweeping call yet, a coalition of civil rights organizations have demanded a six-month moratorium on foreclosures. They want lenders - whose reckless and sometimes predatory policies are largely blamed for the crisis - to help victims refinance their mortgages, or face law suits."

"But the industry is resisting the moratorium, calling it an 'over-reaction' to the difficulties of the market.

"The problems of the subprime market have sent shudders through financial markets, amid fears they could spill over into the broader economy. On Monday, New Century Financial, one of the largest US subprime operators, filed for bankruptcy protection."

"The subprime market is huge, involving loans worth a total $1.3 trillion. But although one in six subprime borrowers are at least two months behind on their payments, the majority are not. Moreover, the rate of overall homeownership has jumped from 64 per cent to 69 per cent in little more than a decade, largely thanks to the subprime market which helps people not previously eligible for loans to obtain them."

Friday, April 6, 2007 in The Independent (UK)

portrait of professional woman

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

Mary G., Urban Planner

Cover CM Credits, Earn Certificates, Push Your Career Forward

Logo for Planetizen Federal Action Tracker with black and white image of U.S. Capitol with water ripple overlay.

Planetizen Federal Action Tracker

A weekly monitor of how Trump’s orders and actions are impacting planners and planning in America.

July 9, 2025 - Diana Ionescu

Green vintage Chicago streetcar from the 1940s parked at the Illinois Railroad Museum in 1988.

Chicago’s Ghost Rails

Just beneath the surface of the modern city lie the remnants of its expansive early 20th-century streetcar system.

July 13, 2025 - WTTV

Aerial view of downtown San Antonio, Texas at night with rotating Tower of the Americas in foreground.

San Antonio and Austin are Fusing Into one Massive Megaregion

The region spanning the two central Texas cities is growing fast, posing challenges for local infrastructure and water supplies.

July 3, 2025 - Governing

White park shuttles with large Zion logo on side and red rock cliffs in background in Zion National Park.

Since Zion's Shuttles Went Electric “The Smog is Gone”

Visitors to Zion National Park can enjoy the canyon via the nation’s first fully electric park shuttle system.

7 hours ago - Reasons to Be Cheerful

Chart of federal transportation funding comparing Biden and Trump administration spending.

Trump Distributing DOT Safety Funds at 1/10 Rate of Biden

Funds for Safe Streets and other transportation safety and equity programs are being held up by administrative reviews and conflicts with the Trump administration’s priorities.

July 15 - Transportation for America

Close-up on yellow and black TAXI sign on top of beige car in central Munich, Germany.

German Cities Subsidize Taxis for Women Amid Wave of Violence

Free or low-cost taxi rides can help women navigate cities more safely, but critics say the programs don't address the root causes of violence against women.

July 15 - Bloomberg