This article shows that Fannie Mae's "American Dream" program began in 2000, not 2004. So it was not Bush's "American Dream" program. It was Clinton's and Fannie Mae's.
In spring 2000 Fannie Mae pledged 2 trillion over several years for minorities and low income people. The goal was to get 5 million more minorities into homes. By 2004, Fannie Mae had already lent out the whole 2 trillion dollars - about 6 years ahead of time. So they had to pledge more money to the program. This is the $440 billion Bush seems to be taking credit for.
All Bush ever did was take half of HUD's regular yearly budget and give half of it to his zero down "American Dream" program. This cost 200 million a year and only 6% default. He stopped his program in July 2007 but a bipartisan congress wants to vote it back in. He had nothing to do with the lending crisis. Congress approved his budget for this.
http://fhaloanadvice.com/h.-r.-6694-passes-out-of-committee/
The republican bill to oversee Fannie Mae took 4 years to pass congress, senate, president. It finally passed in 2007 only because there was a crisis.
Someone at YouTube nicknamed this scandal
Thanks for providing the infomation!
Thanks for the link. It is a most interesting article that gives a significant amount of background behind what Bush said in 2002.
I think that's a different beastie. According to Bush's 2002 speech, or at least the way I read it, Bush proposed a new "American Dream Downpayment Fund."
"...And so that's why I propose and urge Congress to fully fund the American Dream Downpayment Fund..."
Bush signed the American Dream Downpayment Act into law on December 16, 2003.
All Bush ever did was take half of HUD's regular yearly budget and give half of it to his zero down "American Dream" program. This cost 200 million a year and only 6% default. He stopped his program in July 2007 but a bipartisan congress wants to vote it back in. He had nothing to do with the lending crisis. Congress approved his budget for this.
Then again, it may be that he's just taking credit for legislation/changes that were already in the pipeline as many of the things in this article are also a part of his 2002 speech.
For example:
"In 2000, Fannie Mae launched several new mortgage products, processes and partnerships to help the mortgage finance system deliver low-cost mortgage credit, on flexible terms, to people and places outside the mainstream," Raines reported. "We are widening the mainstream - lifting more boats - with very low down payment loans, special community lending products for financial institutions, targeted investments in urban renewal plans, cooperative arrangements with faith-based organizations and other affinity groups, and accelerating our investment in affordable rental housing."
The National Minority Homeownership Initiative
Fannie Mae has challenged the public and private sectors to join in setting a national goal of creating five million new minority homeowners by 2010. Through the American Dream Commitment's National Minority Homeownership Initiative, Fannie Mae has committed to contribute at least $420 billion in mortgage investments to serve more than three million minority households over the decade.
And,
-- Fannie Mae launched the "Welcome Initiative: A New Home in a New Country," a comprehensive bilingual marketing campaign to help our lenders address the needs of immigrant borrowers nationwide. Through this effort, lenders have been able to offer immigrant families a Fannie Mae mortgage with small down payments, knocking down a major obstacle to homeownership. A total of $111 million in loans was made to immigrant families under this initiative in 2000.
And,
-- The "Casa" Channel. Fannie Mae, together with the online subsidiary of Univision Communications and Countrywide Home Loans, Inc. launched the "Casa" channel on Univision.com. Casa is the first online Spanish-language resource for home buying and homeownership. Casa was created to help increase the homeownership rate among the nation's 33 million Hispanics by providing the necessary home buying information, tools, and the ability to apply for a loan from Countrywide online.
If Fannie was already making home loans to 'immigrants', then I don't understand why the changes to banking system to allow Mexican Matricula Consular card to be used as ID were necessary, or even mentioned in the USA PATRIOT Act.
Also, giving 111 million per year over a 10-year period only totals 1.11 billion and Fannie was talking about expanding this to $420 billion over ten years.
The only reasonable explanation I can think of is that these loans (" A total of $111 million in loans was made to immigrant families under this initiative in 2000") was made to resident aliens and the banks wanted to expand into the illegal alien market.
That is clearly what is said in the FDIC's own web page about the P4P and NATF. (See: Partnership for Prosperity)
The most significant recent waves of immigrants to this country, according to the 2000 Census, are from Latin American countries. This group's purchasing power is expected to almost double from $491 billion in 2000 to $926 billion by 2007.1 The international remittance market, particularly in Latin America and the Caribbean, also is expected to grow considerably. Billions of dollars are flowing from the United States to Mexico and other countries, and a significant share of these transactions is taking place outside the formal banking system.
These impressive numbers provide a compelling incentive for U.S. banks to enter this largely untapped market. Studies show that as many as 10 million households in the United States are "unbanked" (without access to mainstream bank products and services) and a significant number of these unbanked households are Latino immigrants. This article focuses on the size and economic potential of the Latino immigrant market, the innovative approaches that some banks are using to capture this new customer base, and key risks and regulatory issues that banks should consider in offering remittance products.
...
In addition, a growing number of U.S. banks accept alternative forms of identification to help taxpaying immigrants open bank accounts and secure other banking services; these include the Individual Taxpayer Identification Number (ITIN) and foreign government issued identification, such as the Mexican Matricula Consular card. The USA PATRIOT Act allows financial institutions to accept both forms of identification, enabling insured financial institutions to serve unbanked immigrants who live and work in the United States.
...
Recent economic and demographic trends, coupled with increased financial flows across international borders, have significant implications for U.S. banks and thrifts. As more insured financial institutions reach out to the Latino immigrant market, these institutions are expected to experience more rapid deposit and loan growth. In the Midwest, both small and large banks are capitalizing on remittance flows as a short-term strategy to draw immigrants into the formal banking system. Leveraging these relationships will help these institutions offer a broader range of financial services, positively contributing to their bottom line.
Many Latino immigrants will eventually settle in the United States and raise families. Banks in the Midwest are taking steps to capitalize on the growing presence of this immigrant group. The continued success of the New Alliance Task Force demonstrates that unbanked Latin American immigrants can be brought into the financial mainstream. As a result, the FDIC is considering the feasibility of expanding the NATF pilot to other parts of the country where there are significant immigrant populations. These broad-based private-public sector alliances will help immigrants increase savings, build assets, and strengthen their financial security.