How do you feel this contrasts with the Student Aid/Loan/FAFSA regime? I made the exact same argument as op the other day about higher education and I really thinks it fits much better in that context than it does when used with housing finance.
Additionally, with student loans there is essentially no due diligence on the lender's behalf because the loans are not dischargeable in bankruptcy. So students are paying a hundred+ thousand dollars for a masters in art history that will have no return (other than intellectual). Compare that to a house, where a bank won't give you a loan if they don't agree that the house is worth that.