New Duke resource on the mortgage lending that led to the Great Recession

Guest Post from Edward Balleisen:

Readers of this blog may be interested in a new website, American Predatory Lending (APL), which explores the state-level dynamics of mortgage lending in the run-up to 2008, with an initial focus on North Carolina.  Law professors who teach about consumer law and/or banking law will find a range of resources that introduce the complicated issues around residential mortgages to students.  The site includes a series of oral history interviews with former state legislators and regulators, representatives of the banking industry, and leaders of NGOs related to mortgage lending.  One key topic concerns the passage and later enforcement of the 1999 North Carolina Predatory Lending Law, which became a model for several other states that wanted to crack down on abuses in the residential mortgage market.  Interviewees also reflect on the evolution of the mortgage market since the 1970s, the shifting regulatory contexts over that time span, and their views about what caused the 2008 financial crisis.


Data visualizations of statistics about the North Carolina mortgage market and consumer protection enforcement complement the oral histories, as do a set of policy timelines and memos about state- and national-level regulation of mortgage lending.  Our key findings suggest that more stringent oversight of aggressive mortgage practices moderated the housing boom in North Carolina, and so partially insulated the state from the broad collapse in housing values across the country.


The CL&P Blog audience may also find our mode of organizing research of interest.  We are part of Bass Connections, a Duke University program that supports interdisciplinary research teams comprised of faculty, graduate and professional students, undergraduates, and often community organizations.  These teams spend a year or more addressing some pressing societal issue or challenge.  For faculty, the teams often serve as a seed grant; most students receive academic credit.  (As a matter of disclosure – in my capacity as Vice Provost for Interdisciplinary Studies, I’m responsible for overseeing the program).


The American Predatory Lending team includes four leads – me, a Professor of History and Public Policy who specializes in the history of American law, business, and regulation, as well as Vice Provost; Lee Reiners, Executive Director of Duke Law School’s Global Financial Markets Center; Joseph Smith, former North Carolina Commission of Banks; and Debbie Goldstein, Director of Duke’s North Carolina Leadership Forum. 


But the bulk of our research (the conducting of our interviews, the development of our data and policy analysis, and the construction of our website) was carried out by a team of seventeen students – fifteen from Duke and two from UNC-Chapel Hill.  They included graduate students in law, business, public policy, and data science, and undergraduates majoring in history, sociology, economics, public policy, statistics, computer science, philosophy, and engineering.  We divided this group into overlapping sub-teams – oral history, data, policy, IT/website development, and marketing – each with one or two student leads.  One graduate student also served as overall project manager.


We will be continuing our research over the summer and next year, drawing on the talents of a few continuing students and an even larger new cohort.  In addition to engaging in county level analysis of North Carolina mortgage markets and delving more deeply into consumer protection efforts across the state, the team will be extending its geographic focus to additional states that either had comparatively tough or permissive consumer protection regimes during the 2000s.


The Bass Connections model may be of interest to law professors interested in building courses or research leading to law review notes around larger-scale collaborative inquiry.  The program’s robust website includes several hundred team profiles, an archive of student reflections, and extensive resources for planning, organizing, and leading interdisciplinary research teams, as well as building those endeavors into curricular structures.

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