I read a recent article on the subject by Dr. Walter E. Williams, who serves as John M. Olin Distinguished Professor of Economics at George Mason University.  Dr. Williams points to the Community Reinvestment Act of 1977 and amendments thereto by the Clinton administration as being the chief cause of the subprime mortgage mess.  He says that the CRA basically forced lenders to make loans to more high-risk borrowers in an effort to discourage "redlining" in low-income neighborhoods.

According to an article in The Atlanta Journal-Constitution (11/04/07) titled "Black Atlantans often snared by subprime loans," by Carrie Teegardin, a national study of credit scores, not just mortgage loan applicants, found that 52 percent of blacks have credit scores that would classify them as subprime borrowers compared with 16 percent of whites.

Many lenders did make loans to people who had no realistic ability to pay them back. But that doesn't qualify as fraud, although there might have been a bit of exuberance in the repackaging of the mortgages into securities and selling them to investors. Some argue that many borrowers defrauded the banks by misrepresenting their income, the so-called "no doc" loans or "liar's loans".

The last I heard, only about 5 to 6 percent of all mortgages are in a delinquent status.  According to Dr. Williams, delinquency rates were higher in the 1980s than today.  The prime (no pun intended) cause of the issue is misguided governmental regulation, plain and simple.  Now comes Congress charging to the "rescue" on their white horse with a solution that only helps a handful of people and leaves the rest of us holding the bag.