Wednesday, October 01, 2008

Chris Dodd and Angelo

Senator Christopher Dodd chairs the Financial Services Committee. Chris Dodd is a Democrat from Connecticut. I used to live in the Second District which he once represented, as did his father, Tom Dodd, before him.

Christopher Keating reports on the Capitol Watch blog for The Hartford Courant that Dodd, the younger, refinanced two 30-year mortgage loans from Countrywide Financial Corp. in 2003.

Countrywide was America's biggest mortgage lender. Countrywide's business model was to write mortgages through its network of offices around the country and package them into mortgage backed bonds. It got itself into financial trouble when it found it could no longer tap short term credit markets to provide bridge financing while it marketed these bonds. That was further aggrevated when investors became reluctant to buy them.

Fannie Mae's and Freddie Mac's exposure to Countrywide was substantial. Bernard Ducalion tells us, "During the first nine months of 2007, Countrywide accounted for about 29% of Fannie’s single-family business volume (Page 106 of 10-Q)."

Countrywide's chairman and chief executive officer, Angelo Mozilo, personally handled Dodd's refinancing. This was under a special procedure for high profile loans called the "Friends of Angelo" program. "Dodd refinanced his Washington townhouse with a loan of $506,000 and refinanced his East Haddam home for $275,042." Conde Nast Portfolio estimates that the favorable rates accorded the then ranking member of the Finacial Services Committee were valuable: "The Conde Nast article stated that Dodd's 30-year loans were both designed to be at 4.875 percent, but the East Haddam loan was reduced to 4.5 percent and the Washington loan was dropped to 4.25 percent. Over the life of the loans, that saved the Dodds about $58,000 on their Washington home and $17,000 on the East Haddam home, according to the article. Countrywide also waived three-eighths of a point on one loan and one quarter of a point on the other."


The Center for Responsive Politics has tracked the cumulative contributions since 1989 from those associated with Fannie and Freddie. Senator is #1. Interestingly, Sen. Obama, although handicaped with only four years in Congress, has leapfrogged over the other 533 members of the House and Senate to achieve #2. Sen. McCain, however, appears to be in their now nationalized GSEs' doghouse. He has gotten less than one sixth what Obama has gotten and that is over a period five times as long:

All Recipients of Fannie Mae and Freddie Mac Campaign Contributions, 1989-2008
Name Office State Party Grand Total Total from
Total from
Dodd, Christopher J S CT D $165,400 $48,500 $116,900
Obama, Barack S IL D $126,349 $6,000 $120,349
Kerry, John S MA D $111,000 $2,000 $109,000
Bennett, Robert F S UT R $107,999 $71,499 $36,500
Bachus, Spencer H AL R $103,300 $70,500 $32,800
Blunt, Roy H MO R $96,950 $78,500 $18,450
Kanjorski, Paul E H PA D $96,000 $57,500 $38,500
Bond, Christopher S 'Kit' S MO R $95,400 $64,000 $31,400
Shelby, Richard C S AL R $80,000 $23,000 $57,000
Reed, Jack S RI D $78,250 $43,500 $34,750
Reid, Harry S NV D $77,000 $60,500 $16,500
Clinton, Hillary S NY D $76,050 $8,000 $68,050
Davis, Tom H VA R $75,499 $13,999 $61,500
Boehner, John H OH R $67,750 $60,500 $7,250
Conrad, Kent S ND D $64,491 $22,000 $42,491


Maggie said...

Just because Chris Dodd is a Senator for the United States what right does it give him to take advantage of mortgage companies into letting him having a better deal? He should have to find the better deals just like every other millions of Americans do every day. He should also have to pay the money that saved from both his Washington home and the East Haddam home.

Anonymous said...

Theres no way anyone in general should get any type of special break or advantage on their mortgages. Why would he deserve and deal better than anyone else. Making you a Senator is a privledge not a right and he should not get that. He is a regular person just like everyone else and he should (just like everyone else) find have to find the better deals.