Obama Discusses Plan to Protect Homeownership, Crack Down on Predatory Lenders at San Antonio Roundtable
In his first major stop of the Texas primary campaign, Senator Barack Obama sat down with San Antonio-area residents this afternoon to discuss his commitment to cracking down on lenders who take advantage of working families. Citing the more than $185 million spent by lenders on Washington lobbying over the last several years, Senator Obama pointed to the mortgage crisis as yet another example of why we need a President who will stand up to special interests on behalf of American families.
"To give you a sense of what that kind of lobbying gets you," Obama told the participants, all of whom have seen first-hand the devastating impacts of predatory lending, the "CEO of the largest subprime lender was promised a hundred-million-dollar severance package at a time when more than 2 million Americans were facing foreclosure, including nearly 14,000 right here in San Antonio."
Senator Clinton's plan to freeze mortgage rates is not sufficiently targeted to struggling families who need help and would actually put more families at risk. In fact, one economic analyst called her plan "disastrous."
"Senator Clinton and I don't totally agree on the best way to solve this problem," Obama said. "She says we need to freeze the monthly rate on existing adjustable rate mortgages for at least five years. But here's the problem. That will reward folks who made this problem worse and it will also reward folks who are wealthy and don't need it - but it won't just target the struggling homeowners who need help most. And on top of that, a blanket freeze like this will drive rates through the roof on people who are trying to get new mortgages to buy or refinance a home. Experts say the value of homes will fall even more, and even more families could face foreclosure. We shouldn't be doing things that hurt honest, hard-working folks who are just trying to get a new mortgage. We should be cracking down on banks that engage in reckless lending, and helping borrowers who played by the rules in a game that was rigged against them."
Obama - who introduced a bill to fight predatory lending and punish fraudulent lenders nearly two years ago - outlined his plan to protect homeownership and crack down on predatory lending.
As President, Obama will:
* Penalize predatory lenders and use those penalties to help the families they tricked stay in their homes or refinance their mortgages;
* Give a tax credit to struggling homeowners that would cover 10% of the interest on their mortgages every year;
* Make an additional $10 billion in bonds available to help middle class folks buy their first home or avoid foreclosure.
* And mandate accurate loan disclosure to ensure consumers understand their loan agreements.