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How Housing’s New Players Spiraled into Banks’ Old Mistakes
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How Housing’s New Players Spiraled into Banks’ Old Mistakes

Matthew Goldstein, Rachel Abrams and Ben Protess
The New York Times, 2016
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Editorial Rating

8

Recommendation

Private equity firms’ entrance into the housing market in the wake of the 2008 housing crisis helped restabilize America’s economy, but have they done a better job than banks at keeping struggling homeowners from foreclosure? Investigative journalists Matthew Goldstein, Rachel Abrams and Ben Protess examine private equity firms’ effect on homeowners and renters. In the process, the authors reveal the ways the firms have, in many ways, “repeated the mistakes” of the banks they supplanted. getAbstract recommends this article to policy makers, homeowners and economists.

Take-Aways

  • Private equity firms’ entrance into the housing market post-2008 helped the American economy and rewarded investors.
  • Firms like Lone Star prioritize investor profits, meaning they may push for foreclosure if it will net more cash or may offer mortgage modifications which increase homeowners’ monthly payments.
  • A 2014 investigation of Nationstar Mortgage revealed the company “lost files and failed to detect errors” in homeowner mortgage documents.

About the Authors

Matthew Goldstein is assistant business editor for the Dealbook financial news service at The New York Times, where Rachel Abrams and Ben Protess are investigative reporters.

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