Report: Don’t give up on ‘nonprime’ lending

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With so many people now saddled with poor credit, reestablishing "nonprime" lending is increasingly important to theĀ future of homeownership, researchers at Harvard University's Joint Center for Housing Studies argue in a new report.The 212-page report, "Understanding the Boom and Bust in Nonprime Mortgage Lending," analyzes how the practice of pooling nonprime mortgages into securities that were sold to investors helped fuel the housing bubble and resulting financial crash and recession.Although much of that territory has been explored before, the report also looks ahead, drawing lessons from the past to put forward ideas for "sustainable" nonprime lending, and advocating a continuing role for government in guaranteeing mortgage debt.Nonprime lending -- subprime, alt-A and higher-priced lending -- grew at a rapid pace during the housing boom, collapsing when the secondary market for those loans froze in August 2007.The secondary market for mortgage loans...