Sweetheart Mortgage Loan Deals: Senators Only?

Posted: Jun 26, 2008 9:59 AM

Sweetheart Mortgage Loan Deals: Senators Only?

House Republicans, led by Republican Study Committee Chairman Jeb Hensarling, sent this letter to Financial Services Committee Chairman Barney Frank (D-MA) requesting a hearing on Countrywide Financial’s VIP treatment on mortgage loans to Senate Banking Committee Chairman Chris Dodd (read this letter!) and Senate Budget Committee Chairman Kent Conrad.  And as the Politico has reported, all of the 100 members of the Senate were contacted about the terms of their mortgages, and it looks like they’re not talking.  Now I’ve had to fill out these financial disclosure forms before, and trust me, they leave no stone uncovered.  If you’re looking for financial privacy, public office is the last place you’ll find it.  So it looks like these Senators have figured out the loophole to keep their mortgage rates under wraps, but Senators Cornyn and Boxer have offered an amendment to the (stalled) housing bill that will require these details to be shared.   

Now the Action Points...

Contact (meaning call, don’t email) Chairman Barney Frank and tell him you’ve read this letter and you’d like to see an immediate hearing on the sweetheart loan deals that Senators are receiving while their constituents are supposedly drowning in mortgage debt. 

Also make sure to check in with your Senator and make sure they are providing that information.  If not, you may have reason to be suspicious. 

Rep. Hensarling’s letter after the jump...

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June 20, 2008

The Honorable Barney Frank


Committee on Financial Services

2129 Rayburn House Office Building

Washington, DC  20515

Dear Chairman Frank:

We are writing to respectfully request that you immediately hold a Financial Services Committee hearing regarding the allegations that Countrywide Financial provided preferential treatment on mortgage loans to Members of Congress and other government officials through a V.I.P. program directly managed by Countrywide’s Chairman and C.E.O., Angelo Mozilo. According to recent news reports, the “Friends of Angelo” program provided special mortgage loans to certain Members and other influential people, which resulted in tens of thousands of dollars in savings through reduced rates, fee waivers, and unique benefits not accessible to the general public. 

As Congress prepares to consider a massive bill that would directly benefit mortgage lenders such as Countrywide, it is important that the Committee examine the validity of these allegations and the extent to which the Friends of Angelo program may affect ongoing policy negotiations.  The housing legislation currently being negotiated between the House and Senate could cost taxpayers as much as $300 billion.  We do not believe it would be responsible to proceed with this sort of sweeping legislation until we know the true extent and effect of the Friends of Angelo program. 

The media reports on these preferential loan deals given to powerful Members and other government officials raise serious questions, and it would be irresponsible to move forward on a massive housing bill until certain questions are answered regarding the Friends of Angelo program.  Holding hearings to provide fuller understanding of what actually happened is clearly warranted.

Thank you for your timely consideration of this important request. 


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