Posted on 04/23/2009 2:03:33 PM PDT by buccaneer81
Kilroy letter may have influenced AIG company's decision Thursday, April 23, 2009 3:00 PM By Jonathan Riskind THE COLUMBUS DISPATCH
WASHINGTON -- Did an inquiry by Rep. Mary Jo Kilroy on behalf of a desperate constituent facing foreclosure persuade a giant AIG-owned mortgage company to take part in an Obama administration-crafted loan modification program?
In a back and forth exchange between Indiana-based American General Finance and Kilroy, D-Columbus, the mortgage company doesn't acknowledge a cause and effect in its reversal. And AIG indicated that the chain of events leading up to the change of heart predates Kilroy's involvement.
But the timing of the company's decision to participate in the Making Home Affordable program and Kilroy's questioning is at the very least a striking coincidence.
It was on April 7 when a Kilroy staffer, Noah Cuttler, sent an e-mail to the mortgage company, one of American International Group's holdings. Cuttler said that a Kilroy constituent had hoped to restructure its American General Finance subprime, variable rate loan under the government incentive rules set out by the Making Home Affordable program. But the constituent had been told by American General Finance that the company did not participate in the program.
"The constituent is upset that a subsidiary of AIG elected not to participate in the program, even though AIG has received $40 billion in TARP (Troubled Asset Relief Program bailout) funds and has been pledged an addition $30 billion in TARP funds (out of a total pledge of $200 billion in financial assistance from the federal government)," Cuttler wrote.
But Kilroy was told in an April 15 letter from American General Vice President and general counsel Thomas Graber that the mortgage company decided not to participate because it is "not a bank, and does not take deposits" and is not "eligible for the various programs covered in the Troubled Assets Relief Program (TARP), nor for the FDIC's Term Loan Guarantee Program."
Graber added that the mortgage company believed that it could do a better job aiding struggling homeowners through American General's "own, individualized modification approach."
But then in a letter date April 21, another letter was sent to Kilroy by Graber as an "update." Graber said that on April 17, AIG had actually entered into some new agreements with the U.S. Department of Treasury, including one that said all its subsidiaries, such as American General Finance, would begin participating in the Making Home Affordable Program.
"Although we may have indirectly received some TARP funds from AIG (the same as other counterparts), we have also returned more dollars to AIG than we have received," Graber wrote. "At the same time, we recognize that we have benefited from being part of an organization that has received substantial government support, including through the TARP, and we look forward to doing our part to carry out our new commitments."
Graber added that if Kilroy wanted to "forward the name of your constituent who made the inquiry, as offered in my previous letter, we would be more than happy to look further into his or her situation."
Said Kilroy:
"It should not take an inquiry from a member of Congress to make bailout recipients participate in a program that will help American families struggling with their mortgage, but I am glad I can call my constituent with a positive outcome that will help other families as well."
"The cost of families losing their homes goes well beyond the immediate crisis created for these homeowners," Kilroy added. "This (Making Home Affordable) program is a wise investment for businesses, but more importantly a wise investment for our communities."
The Obama administration unveiled the program in March. It partly gives homeowners with loans owned or guaranteed by Fannie Mae or Freddie Mac the chance to refinance their mortgage to gain lower payments. But it also aims to help several million other homeowners stave off foreclosure by providing financial incentives to mortgage companies to modify existing loan terms of non-Fannie or -Freddie mortgages.
An AIG spokesman said today that American General Finance is "proud of its strong track record of modifying loans that have kept people in their homes and avoided default." Spokesman Mark Herr said that American General in early 2008 adopted a loan modification program that "has yielded an 80 percent success rate, keeping thousands of people in their homes."
But AIG, nonetheless, had been negotiating with the government for some time prior to the April 17 agreement with about participating in the Making Home Affordable program, Herr said. When that April 17 agreement was reached, American General realized it had to notify Kilroy about the change, one that had been in the works prior to and separate from Kilroy's exchange with American General.
"We thank the congresswoman for bringing this matter to our attention and we regret any confusion," Herr said.
Ohio ping!
I swear.
Mine too. She is God awful ugly. I can not get the simplist of requests responded to. So, I call frequently and ask more and more questions never getting a response.
It partly gives homeowners with loans owned or guaranteed by Fannie Mae or Freddie Mac the chance to refinance their mortgage to gain lower payments.
http://globaleconomicanalysis.blogspot.com/2009/04/fannie-freddie-delinquencies-soar-and.html
Fannie Freddie Delinquencies Soar (and they are going to get much worse)
On Tuesday, Fannie Mae and Freddie Mac reported Mortgage Delinquencies Rose 50% in a Month.
I got a condescending e-mail when I told her off about the bailouts.
They simply resemble their voting base.
I want Bob Conners to get her on WTVN. As with that dirtbag Coleman, it'll never happen.
Both inside and out.
The leftist clowns have a constituency who're certifiably nuts.
We're all well aware of that, too.
That’s what’s on my tax bill this year.
“It should not take an inquiry from a member of Congress to make bailout recipients participate in a program that will help American families struggling with their mortgage, but I am glad I can call my constituent with a positive outcome that will help other families as well.”
This is pretty much a non-sequitor.
I agree. For a Congresscritter, it's standard CYA.
I reached the conclusion that Conners is a weakling. I can hardly take him anymore and only listen to 610 to hear Beck and Rush....and the weather....
He's old and soft. He broadcasts from Florida five months a year. Sadly, Corby won't get more controversial than asking for people's wedding horror stories or some such nonsense. Steve Cannon had more guts than most of the crew there. They need to put Dirk Thompson in Corby's spot. That would fire things up a bit.
What no Korby?
Nope, He is sometimes to juvenile for me. Besides, there are more important things to discuss in our Country today that the pap he seems to draw interest in. Pop culture is a cancer in the country and the less we talk of it, the better we will all be....
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