Hillary Clinton Corleone, Mortgage Lender

There is a key sequence of scenes in “The Godfather: Part II” in which a young Vito Corleone exerts his ascending power and influence over New York’s Little Italy neighborhood. A poor widow named Signora Colombo asks Corleone to intervene with her landlord, Roberto, who wants to evict her. Colombo cannot afford to move, and she has no where else to live.

Corleone seeks out the landlord Roberto and offers to pay six months of Signora Colombo’s rent in advance, at an increased rate. Roberto refuses, but soon finds out that Vito Corleone is not a man given to negotiation. A trembling Roberto then visits Corleone and says that Signora Colombo can not only stay in her home, but he will greatly reduce her monthly rent. Roberto leaves, and Corleone’s friend Genco declares, “God Bless America. We’re gonna make a big business.”

The Democratic presidential candidates see today’s Signora Colombos – families who defaulted on adjustable rate, sub-prime mortgages they could not afford – just as Corleone saw the poor widow – as helpless perdente, manipulated by others, who could not survive the mean streets without the helping hand of Don Vito Government.

On August 7, Sen. Hillary Clinton announced her detailed plan to “address mortgage lending abuses.” Clinton’s press statement, found on her web site, begins, “With foreclosure rates continuing to skyrocket across the country, Senator Hillary Clinton . . . laid out a plan to preserve the American dream of home ownership that would crack down on unscrupulous brokers, curb mortgage-lending abuses, assist families facing foreclosure and expand affordable housing options.”

The concept of borrower responsibility is obviously lost on Clinton. She then cites the plight of her own Signora Colombo, a woman named Kristi Schofield. Kristi and her husband can no longer afford to live in their home, because their adjustable-rate mortgage payments grew from $2,400 to $6,000 per month.

Signora Schofield said, “We tried to do the right thing and continued to make the payments as long as we could with our savings and what earnings we had from unemployment, temporary and part-time work.”

Schofield added, “Hillary Clinton is standing up today because she wants to help protect the American dream.”

In truth, Clinton’s plan would heap onerous and needless new regulations on the mortgage industry and establish a $1 billion housing trust fund to help “at-risk borrowers avoid foreclosure.” In other words, Clinton’s plan requires responsible taxpayers to subsidize the mortgage payments of deadbeats unable to comprehend the concept of adjustable mortgage rates.

Worse, if Clinton’s plan and similar plans touted by her Democratic opponents were to become law, the element of risk in borrowing and investing capital would disappear. If borrowers and investors incur no risk due to federally subsidized payments, nothing would stop lenders from inflating their home mortgage rates far beyond market-established values. Government subsidies have already distorted the free market and raised costs through agriculture, college tuition and health care programs.

An August 7 Wall Street Journal article that details the credit and mortgage situation quoted former Federal Reserve Chairman Alan Greenspan, who said, “These adverse periods are very painful, but they’re inevitable if we choose to maintain a system in which people are free to take risks, a necessary condition for maximum sustainable economic growth.”

Preach about it, Mr. Greenspan. The ability to risk money in the various investment markets, in startup businesses, in research and development of new products or in a family home fuels our nation’s turbocharged economic engine. These invested dollars, in turn, produce individual wealth for the risk takers, new consumer products and new jobs.

Contrary to Clinton’s pontifications, the American Dream is not to have the federal government make your house payment. The American Dream involves creating and acquiring enough wealth to make your own house payment, own your own retirement plan and have adequate remaining resources for both necessities and recreation.

Not surprisingly, the media and liberals have grossly overstated the so-called mortgage crisis.

Economist Jerry Bowyer, writing in National Review, found that just 0.6 percent, or 254,000, of the 44 million mortgages in the U.S. are currently in foreclosure. Additionally, the breathlessly reported sub-prime meltdown has caused an increase of only 35,000 mortgage foreclosures in the last quarter.

A new study by the National Assessment of Educational Progress found that just 33 percent of high school seniors could explain the effect of an increase in interest rates on consumer borrowing. America’s Signora Schofields do not need a mortgage bailout. They need a lesson in finance.

Without a national crash course in economics, finance and personal responsibility, Ronald Reagan’s Shining City on The Hill could soon become Hillary Clinton’s Cosa Nostra.

As I read this....sounds to me like Hillary is IN with those unscrupulous lenders...probably taking campaign donations by the oodles from THEM to bail them out of their sorry positions...nothing new here..just recycling old market scams she’s been practicing since the ‘80’s. Any Republican with a pair on them should be able to knock her silly....

I would stick with a traditional fixed rate. Was told to avoid ARM’s like the plague, years ago.

42 posted on 08/13/2007 10:24:12 AM PDT by TheSpottedOwl (If the families still ran Las Vegas, Harry Reid would be napping at the bottom of Hoover Dam)

Hillary Clinton Corleone, Mortgage Lender

Not a member of MY family.

That's a big loan. If you take the $2,400/month and multiply it by 12, the result is annual payments, assumed to be mostly interest, of $28,800. If you assume the interest rate is about 6% and divide .06 into $28,800, you get an estimated principal of about $480,000. Of course, since 6% is a good guess for a fixed rate mortgage, the $28,800 was probably to support a significantly larger principal. Any way you cut it, the lady and her husband were living in pretty expensive digs on an ARM that they should have been smart enough not to take out in the first place. They're poster children for what happens to fools who deliberately overextend themselves, not for people ho legitimately need taxpayer bailouts.

“....what if their company goes belly up, what if they get canned, get sick, their hubby croaks, they get the big D, there is a war, a tornado, they get demoted instead of promoted....the marketplace doesn’t owe them a raise in three yeears....they can’t predict the future....on the other hand we can hope for them that their rich uncle leaves them a million, that they win the lottery, that their ship comes in but no guarantees.’

That could happen with those with fixed interest mortgages as well.

Living beyond your means stinks, but Hillary! will bail you out (for your vote, of course), or so she says...(please note: she’s lying!)

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