I've blogged a bit on mortgage reform, noting that Bush Dogs are trying to block changes to the Bankruptcy Bill out of fealty to their corporate donors. The housing crisis is hitting swing areas like Florida's central corridor viciously, so getting on this topic as the economy becomes one of the two top issues in 2008 is extremely important for Democrats going into 2008.
One of the reasons the situation is so messed up is that mortgage brokers have an incentive to lie and steal from their clients. This is couched in a complicated term called the 'yield spread premium'. What this basically means is that if you are a mortgage broker and you get a client to take a loan that costs more than it should, with higher penalties and interest rates, you get a kickback from the bank.
Ergo, lots of people got crappy loans they can't afford. It hurts minorities disproportionately, and it's bad for everyone. There's more detail here and here. The Democrats are trying to do something about it and ban the practice, but mortgage brokers have organized and are phoning Congress off the hook because apparently stealing is profitable. And now, Barney Frank is considering axing the change because the groups pushing for the change - NAACP, the Urban League, La Raza AARP, the AFL-CIO and SEIU - probably didn't expect this to be a major point of contention.
If you have a moment, write your representative and ask him/her to support HR 3915, the "Mortgage Reform and Anti-Predatory Lending Act of 2007."
It's fucking ridiculous that Congress doesn't stand up to the mortgage industry after they have ripped off millions of borrowers and are in the midst of destroying communities all over the country. Write your rep.
STATE BLOGS
