Sep 29, 2026 Ā· 15 min Ā· 8 segments
In this episode of Facts of Our Feelings, Kevin Thompson expands on five topics he was recently quoted on in major publications. He explores why loosening credit standards won't solve housingā¦
So the first story I think we're gonna stick with is just, we keep trying to make housing more accessible.
So let's get started with housing, right? I was recently asked about proposals designed to make housing easier for Americans to purchase homes.
Mortgage rates have remained elevated compared to what buyers became accustomed to during the ultra low rate years.
You've got insurance, property taxes, maintenance, and of course closing costs.
And then somehow you've got to come up with the down payment on top of all of that, right? So naturally people are looking for solutions, lower down payment requirements, changes to credit standards, changes to underwriting, programs that will make it easier to qualify.
If a $500,000 house is unaffordable for somebody, allowing that person to put less money down doesn't make it a $400,000 house.
And depending on refinancing or financing in general, now they're potentially borrowing even more money against the property.
I'm always cautious when people start talking about loosening credit standards as a solution to housing affordability.
I'm not saying we're going to be headed there, but fundamentally, we're doing the exact same thing over and over again, expecting a different result.
If the fundamental problem is housing supply, home prices, interest rates, and incomes not keeping pace with housing costs, we should be talking about those things.
Making it easier to borrow money doesn't automatically make the underlying asset more affordable.
I think we're going to hear a lot more about this as housing affordability becomes an increasingly political and important economic topic.
So the first story I think we're gonna stick with is just, we keep trying to make housing more accessible.
So let's get started with housing, right? I was recently asked about proposals designed to make housing easier for Americans to purchase homes.
Mortgage rates have remained elevated compared to what buyers became accustomed to during the ultra low rate years.
You've got insurance, property taxes, maintenance, and of course closing costs.
And then somehow you've got to come up with the down payment on top of all of that, right? So naturally people are looking for solutions, lower down payment requirements, changes to credit standards, changes to underwriting, programs that will make it easier to qualify.
If a $500,000 house is unaffordable for somebody, allowing that person to put less money down doesn't make it a $400,000 house.
And depending on refinancing or financing in general, now they're potentially borrowing even more money against the property.
I'm always cautious when people start talking about loosening credit standards as a solution to housing affordability.
I'm not saying we're going to be headed there, but fundamentally, we're doing the exact same thing over and over again, expecting a different result.
If the fundamental problem is housing supply, home prices, interest rates, and incomes not keeping pace with housing costs, we should be talking about those things.
Making it easier to borrow money doesn't automatically make the underlying asset more affordable.
I think we're going to hear a lot more about this as housing affordability becomes an increasingly political and important economic topic.
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