The mortgage scandal plagued, and Senate will have a test-vote today on housing foreclosure rescue program. The Federal Housing Administration (FHA) would provide $300 billion in new, cheaper mortgages for struggling homeowners who otherwise would be considered too financially risky to qualify for government backed, fixed-rate loans.

A plan that will help hundreds of thousands of homeowners avoid foreclosure is drawing support in the Senate. But the recent mortgage scandal involving several senators seems to be fresh on their minds, and for good reason.

Reuters:

Reuters reported on Friday a congressional ethics panel is examining allegations that Conrad and Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat, received preferential loans from Countrywide.

 

Both have acknowledged they refinanced properties as members of Countrywide’s VIP program, but Conrad wrote in his letter the loans he received through Countrywide were “completely within what was commercially available in the market, and widespread practice among mortgage lenders”.

The far-reaching housing plan faces a Senate test-vote Tuesday, when it could also come to a final vote. The disputes among Democrats over key details, however, as well as a veto threat from the White House will almost certainly push any final agreement into July.

AP:

In a letter to Democratic leaders last week, the 42 House members of the Black Caucus said the bill is plagued with “glaring omissions,” including affordable housing funds for states affected by Hurricane Katrina and grants for states and localities to buy and fix up foreclosed properties.

To draw GOP support, Senate Democrats diverted the affordable housing money to pay for the foreclosure aid program.

The Senate bill provides $3.9 billion in grants to deal with foreclosed properties — compared with a House plan providing $15 billion — but the White House singled out the funds in its veto threat, and Blue Dogs are demanding that the money be offset with cuts elsewhere.

Rep. Barney Frank, D-Mass., the Financial Services Committee chairman, said he’d be willing to yank the money and add it to a separate measure in the interests of a deal.

It looks like our president is more worried about saving his boys on Wall Street, like the $35 million dollar bail out of Bear Stearns , then helping millions of suffering homeowners who are losing their homes.

AP:

The White House says President Bush would veto a foreclosure rescue the Senate began debating Thursday.

Administration officials object to the federal government helping states buy foreclosed property and don’t like having Fannie Mae and Freddie Mac pay for the rescue.

Two GOP senators said they’ll try to block the broad housing package until a committee can investigate how much Countrywide Financial Corp. stands to gain from it.

Attention Washington: Countrywide is a sinking ship that has really already sunk. It is just really a mirage in the foreclosure desert held up by propaganda, and funny accounting allowed by the SEC. It’s just buying time until the glorious US government comes in with a US citizen tax based bill to bail them out, and Bank of America can take over their massive portfolio and rule the world!

My best advice is to examine their books, demand accurate and real time accounting on their “actual losses,” and do not let the B of A deal proceed until this mortgage and housing crisis is over.

I think you will find that Countrywide was made the #1 lender by selling snake oil, and all the other lenders just jumped in line. The ever creative boys on Wall Street sweetened the selling power of this oil by dilluting it in CDO’s and SIV’s. They fill their snake oil coolers to get in on the action, and sell these toxic invetments across the world.

By the time this is all said and done, special mortgage deals for our senators will be the least of our worries.

Banking Committee Chairman Christopher J. Dodd, D-Conn., and Budget Committee Chairman Kent Conrad, D-N.D., were part of a Countrywide program that gave cut-rate mortgages to influential people.

The move, if successful, would send the housing package back to Dodd’s panel, essentially killing it.