Senator Dodd and the Housing Crisis

Last Friday, The Wall Street Journal reported that Senator Chris Dodd (D-CT), chair of the Senate Banking Committee, may have received favorable loan terms from Countrywide under its “Friends of Angelo” program (Dodd Tied to Countrywide Loans). Not good, to say the least, for one of the most outspoken critics of the mortgage finance sector to emerge since the “credit crisis” set in. Of course, the Senator denies that he received any special treatment. His press secretary, in the same Journal article, asserted that the Senator received a competitive rate. The Senator himself also responded, saying “As a United States Senator, I would never ask or expect to be treated differently than anyone else refinancing their home. This suggestion is outrageous and contrary to my entire career in public service” (Statement). He goes on to say that he and his wife shopped around and received a competitive rate.

Considering that the Senator is currently negotiating a $300 billion home loan refinancing program, this could be a big problem, to put it mildly. It doesn’t help that each week seems to bring more details about Countrywide’s “Friends of Angelo” program.