No Mortgage Break For Non-VIPs

20 Jun 2008 // I called my mortgage guy, an honest businessman I have known for years.

"Am I a VIP?" I asked.

"Well," he replied, hesitating. "I always treat you like a VIP."

Yes, I know. I'm certainly no Chris Dodd. Neither are any of the rest of you.

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Because when you are U.S. Sen. Christopher Dodd, VIP, and you want a mortgage from Countrywide Financial, it appears to mean all kinds of fees are waived and the deal is sweeter than for anyone else who walks in the door.

That is the difference between us poor suckers with millstone mortgages hanging around our necks and VIP Dodd.

The chairman of the committee that oversees the banking industry offers a hilariously implausible explanation to those who dare ask what he was thinking, accepting loans starting in 2003 from Countrywide Financial after they told him he was in their "V.I.P." program.

"No one ever said to us you're going to get some special treatment. It was a courtesy," he told reporters this week, in a brilliant impersonation of Dick Cheney, Washington's reigning obfuscator-in-chief. "At no point did anyone ever suggest to me that we were supposed to get some deal."

It gets worse. Dodd said he thought he got the deal "because they had been with Countrywide since 1999 and had two mortgages."

Oh please. This is embarrassing.

"Members of Congress are not supposed to get more favorable treatment than others," said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington. A complaint filed by her group is now under investigation by the Senate Ethics Committee.

"The rule is that you can't get any loan on any terms that are more favorable," Sloan said. "You can't say that Dodd shouldn't have any mortgage, but he should have asked more questions."

Or he might have checked his Senate ethics manual: "The public has a right to expect Members ... to exercise impartial judgment in performing their duties. The receipt of gifts, entertainment, or favors from certain persons or interests may interfere with this impartial judgment, or may create an appearance of impropriety."

I don't believe an honorable man like Dodd can be bought off with a cheap mortgage deal. But this "courtesy" explanation is just so lame.

Sen. Dodd chairs the Senate committee considering a bailout of the home loan business that will cost taxpayers hundreds of millions of dollars — and salvage Countrywide's riskiest loans.

Countrywide is reportedly under federal investigation. This was one of the leading companies recklessly pushing the subprime mortgages that sparked the home foreclosure and loan crisis. This was the company where if you were an "F.O.A." — friend of chairman Angelo Mozilo — you could get a sweetheart deal.

A Dodd spokesman told me the senator has no plans to publicly release additional documents and information related to the transaction.

Daniel Golden, of Portfolio.org, writes that "the V.I.P.'s received better deals than those available to ordinary borrowers ... Countrywide often waived at least half a point and eliminated fees amounting to hundreds of dollars for underwriting, processing and document preparation."

Dodd's colleague, U.S. Sen. Kent Conrad, D-N.D. — after a few days on the hot seat — admitted he received preferential treatment from Countrywide in the same VIP program exposed by Portfolio. He's going to donate the $10,700 he saved to a charity.

Dodd should tell us everything about his VIP deal, release all documents and start banking in Connecticut while he's at it.

This time, state Republican Party Chairman Chris Healy has it right.

"You are the head of the banking committee. You are about to light the fuse on a $300 million bailout ... and nothing went off in your head?"

"This isn't a Shaw's card or a Blockbuster card," Healy said. "This is a VIP deal for your mortgage."

Which brings up the other thing about VIPs. They think they can do whatever they want.