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They are Senators Dodd and Kent Conrad, the Democrat chairman of the Senate Banking Committee, the Democrat chairman of the House Budget Committee. They are the prime authors of this bailout bill. They got sweetheart deals.
In a sudden setback that could slow the Democratic nominee's search, Obama lost his top Veep hunter, Jim Johnson, after the former Fannie Mae executive came under scrutiny for accepting preferential mortgages from a lender linked to the foreclosure crisis.
U.S. Charges 400 in National Mortgage Fraud Crackdown
Federal prosecutors have charged more than 400 people across the U.S. in a crackdown against mortgage fraud, as the government stepped up efforts to address the subprime loan crisis.
FBI Director Robert Mueller and Deputy Attorney General Mark Filip said the campaign, called Operation Malicious Mortgage, was designed to send a message that housing crime is a national problem. Almost 300 people have been arrested since March in such major cities as Chicago, Dallas and Miami.
Two U.S. senators, two former Cabinet members, and a former ambassador to the United Nations received loans from Countrywide Financial through a little-known program that waived points, lender fees, and company borrowing rules for prominent people.
Other participants in the V.I.P. program included former Secretary of Housing and Urban Development Alphonso Jackson, former Secretary of Health and Human Services Donna Shalala, and former U.N. ambassador and assistant Secretary of State Richard Holbrooke. Jackson was deputy H.U.D. secretary in the Bush administration when he received the loans in 2003. Shalala, who received two loans in 2002, had by then left the Clinton administration for her current position as president of the University of Miami. She is scheduled to receive a Presidential Medal of Freedom on June 19.
Republican Study Committee Chairman Jeb Hensarling (R-TX) called for an investigation into the sweet deals given to Dodd and Conrad, but his fellow Republicans are loath to leap at the opportunity, signaling that this scandal could spread beyond just one party. Why else pass up a great opportunity to expose the Democrats’ hypocrisy in an election year? Democrats had been hoping to plow a mortgage bailout through Congress before this whole mess gets exposed, but President George W. Bush has threatened a veto because of the overly generous terms for Countrywide and similar lenders. Now we will have to wait and see if Republicans have the courage to take this issue to the bank, as it were, and call the Demos out before the story gets swept away.
How did you make the assumption that Republicans are corrupt? I guess the media has trained you well?
Republican Study Committee Chairman Jeb Hensarling (R-TX) called for an investigation into the sweet deals given to Dodd and Conrad, but his fellow Republicans are loath to leap at the opportunity, signaling that this scandal could spread beyond just one party. Why else pass up a great opportunity to expose the Democrats’ hypocrisy in an election year?
BTW RRconservative they all cut by the same dirty scissors and worship the same gods, Republicans and Democrats only difference is in their party affiliations.
What did the sub-prime market exactly do? It relaxed traditional lending policies to allow for more homeownership. Coupled with down payment assistance programs, borrowers didn’t need any cash, good credit or even much salary to buy giant luxury homes with these programs. It was absolutely conceivable for a young couple making around $50,000 a year in combined income to purchase a $300,000 home with initial mortgage payments totaling less than $1000 a month. Since the initial payment was so low, the normal rental history requirement was no longer applicable.
To further bring down the initial payment and squeeze more home into the loan, Builders were even paying down the interest on the borrower’s loans so that they could move units faster. Loaded with pre-payment penalties and other devices that delay the inevitable, these products were designed to sell homes…quickly.
The politicians and local governments did pretty well from the sub-prime market. For six straight years property values soared nationwide. Tax revenue was at record levels. The builder boom’s exponential effect of raising the existing values as well as adding more contributors to the tax base brought the public coffers to the highest levels in recent memory. No politicians were worried about where it was coming from or what was generating the income at the time.
The staffer was referring to the Dodd-Shelby bill that would let mortgage lenders off the hook for bad loans, ultimately shifting the burden to taxpayers.
The Bank of America paper referenced is this document, a PDF marked Confidential and Proprietary, titled the "FHA Housing Stabilization."
This was first picked up by the NY Examiner, followed by the National Review Online, who noted that "the similarities between BofA's ideal bill and the bill before the Senate are obvious." Then lastly, an LA Times blog, LA Land, put all the separate pieces together with this post: Did Bank of America write the Dodd bailout bill?