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American Bar Association

ABA Section of Business Law


Business Law Today

Our mini-theme: The Subprime Lending Crisis

One cannot pick up a newspaper or log on to a favorite news source without finding a front page article about the current housing crisis and the perils of the lending market. The collapse of the subprime mortgage market has led to calls for greater regulation to protect homeowners. So, what is lurking behind the hand-wringing about overextended buyers and dubious lending practices?Our mini-theme for this issue is subprime lending.The first article takes a look at who is to blame by examining the current municipal subprime mortgage cases in When Bad Things Happen to Good Cities: Are Lenders to Blame? by Richard E. Gottlieb and Andrew J. McGuinness.The article surveys the circumstances, claims, and likely defenses in this emerging area.

Regulatory oversight is bound to get stiffer in the current climate. We turn to Michael C. Tomkies and Regulating the Subprime Market: Finding the Right Balance, which looks at today's subprime market and the merits of protecting consumers, via regulation,from abusive third parties (or their own inability to use credit wisely) without choking off access to credit for the many who can benefit.The mini-theme wraps up by examining the decline of the subprime lending market and the resulting increased call for suitability standards in the subprime mortgage industry with Trends in Subprime Lending: Legislation, Litigation, and Enforcement on the Rise by Travis P. Nelson.

We hope you find these articles helpful in determining what the future holds as we grapple with the tremendous challenges facing the housing and mortgage industry today.

-- Joan Durocher

Washington, D.C.




When bad things happen to good cities
Are lenders to blame?
By Richard E. Gottlieb and Andrew J. McGuinness

Regulating the subprime market
Finding the right balance
By Michael C. Tomkies

Trends in subprime lending
Legislation, litigation, and enforcement on the rise
By Travis P. Nelson

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In re The Walt Disney Company Derivative Litigation
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By Shahzad Q. Qadri

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