Last week the Senate Banking Committee took aim at abusive credit card practices. Yesterday, Senator Dodd was back, focusing this time on predatory mortgages. Two points don’t make a trend, but the same mad-as-hell attitude about abusive lending practices are a sure sign that it is a new day in Washington.
The practices are truly vile: Refinancing people from mortgages they can afford to mortgages that will cost them their homes. Targeting African-Americans and Latinos to sell them more expensive loans than they would qualify for. “Upselling” or, as I like to think of it, mortgage brokers taking a bribe from the lender to place a costlier loan with a family. The litany is long, and no one is rushing to rewrite the laws that permit these activities. But the lending industry has to be sweating just a little.
Martin Eakes from Self-Help presented one staggering statistic after another. Two families testified about what happened to them. Jesse Jackson spoke out. Senators from both sides of the aisle asked tough questions, while the rep from the Mortgage Bankers Association looked very uneasy.
Change is in the air.
