Michelle Malkin » Hillary camp’s subprime sanctimony

Hillary camp’s subprime sanctimony

By Michelle Malkin • March 31, 2008 11:19 AM

From the lender-bashing Hillary Clinton campaign, we learn via Newsday, that campaign chief Maggie Williams (already tainted by the Johnny Chung scandal) got rich while serving “on the board of a Long Island subprime lender that charged prepayment penalties – a practice that Clinton, a critic of the subprime industry, now seeks to eliminate.” It’s the monumental hypocrisy, stupid:

Hillary Rodham Clinton’s campaign manager, Maggie Williams, earned about $200,000 on the board of a Long Island subprime lender that charged prepayment penalties – a practice that Clinton, a critic of the subprime industry, now seeks to eliminate.

Williams, who took over the reins of Clinton’s campaign in early February, served as a director on the board of the Woodbury-based Delta Financial Corp. from April 2000 until the firm declared bankruptcy in December, according to Securities and Exchange Commission records.

She was recruited by former New York City Deputy Mayor Bill Lynch, a Delta consultant. Her assignments were to create a new code of “best practices,” and to improve the company’s crisis management operation in the wake of state and federal predatory lending probes that resulted in a $12 million payout to borrowers.

Her hiring coincided with stepped-up Delta outreach efforts in minority communities, where the company made a large number of its loans, an initiative that included parties for homeless children and mortgage seminars in Brooklyn and Queens.

Williams, 53, isn’t the only Clinton insider who made money from an industry the candidate has demonized. A month ago, The Wall Street Journal reported that Clinton ally and former HUD Secretary Henry Cisneros grossed more than $5 million in stock sales and board compensation from Countrywide Financial, one of the nation’s largest subprime lenders.

Once a poster child for predatory practices, Delta’s reputation improved substantially until it buckled, as executives avoided adjustable-rate mortgages for fixed-rate loans, which have fewer defaults.

To boost revenue in the absence of high-profit adjustable loans, the company charged relatively steep interest rates – 11 percent in 2007 – and levied higher-than-prime-loan closing costs.

And Delta assessed penalties to borrowers who paid off before their loans matured – a practice Clinton frequently decries on the campaign trail.

“I would eliminate the prepayment penalties that lead to such high rates of default,” Clinton said in a March 24 speech at the University of Pennsylvania. “I would require lenders to take into account the borrower’s ability to pay property taxes and insurance fees when deciding whether to make a loan in the first place.”

Subprime loans come with higher interest rates and are offered to borrowers with poor credit. The loans soared along with the housing boom and are an underlying cause of the current credit crisis.

Williams downplayed her role at the company, saying, through an assistant that she served only in “an advisory/oversight capacity.”

Hey, how ’bout returning the money earned through practices your boss so despises, Maggie?

Cue the chirping crickets.

***

On a related note, check out the new “Don’t Foreclose Me, Bro!” t-shirts now on sale:

Posted in: Subprime crisis

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#276016

On March 31st, 2008 at 11:22 am, cpodug said:

“Ethics?? We don’t need no stinking ethics!!!“
#276018

On March 31st, 2008 at 11:23 am, Armigerous said:

Now,now,Michelle…we mustn’t ask Maggie to return that money….that would be ‘racist’
#276022

On March 31st, 2008 at 11:27 am, shooter said:

Subprime loans come with higher interest rates and are offered to borrowers with poor credit.

It’s such a misnomer to begin with, sounding like a good deal.
The truth here is that they are SUB-PRIME BUYERS, not Sub-Prime loans, which I’ve been saying for 3 years now.
Sounds like a Clintonian phrase, hh?
#276023

On March 31st, 2008 at 11:27 am, 30 pcs of silver said:

Stuck on Stupid!
#276033

On March 31st, 2008 at 11:52 am, granite said:

“… Clinton said in a March 24 speech at the University of Pennsylvania. “I would require lenders to take into account the borrower’s ability to pay property taxes and insurance fees when deciding whether to make a loan in the first place.””

Haven’t the socialists, including the Clintons, in the past condemned, as being unfair and uncaring, responsible lenders who do unfair and uncaring things such as take into account the borrower’s ability to pay all housing costs, including principal & interest installments, insurance premiums, property & other taxes, utilities, etc?

I don’t think that I’m inaccurate when I say that her statement sounds a bit hypocritical.
#276034

On March 31st, 2008 at 11:52 am, nbarry said:

With the Alphonso Jackson resignation, this is starting to look like a case of “all fall down.” I wonder how many players will progress from subprime to subpoena.
#276035

On March 31st, 2008 at 11:53 am, William Teach said:

BTW, both Obama and Hillary have received over a million each from subprime lenders for their campaigns.
#276036

On March 31st, 2008 at 11:54 am, granite said:

#6 On March 31st, 2008 at 11:52 am, nbarry said:

“With the Alphonso Jackson resignation, this is starting to look like a case of “all fall down.” I wonder how many players will progress from subprime to subpoena.”

Gotta acknowledge that excellent bon mot: “…from subprime to subpoena.”

Bravo!
Rim shot, please!
#276042

On March 31st, 2008 at 12:00 pm, Larraby said:

As noted above, the WSJ had a chart showing all of the donations Hillary Clinton received from subprime lenders. Nobody in the MSM will ask her if she will return the donations. And Delta Financing was among the worst of the subprimes. They sucked alot of people into especially bad mortages with prepayment penalties that make it impossible for people to refinance with another lender. I wonder if Hillary will ask Maggie Williams to sever her ties with Delta and return the money she reeived from them. As to Bill Lynch, He was a David Dinkins hack who was Deputy Mayor during the Dinkins administration. Yep, the same David Dinkins who forgot about filing his federal income taxes for a few years and whose son skedaddled out of NYC when City investigators wanted to interview him.
#276052

On March 31st, 2008 at 12:12 pm, TMoney said:

I didn’t think it was legal to penalize a buyer who paid off a loan early. (Forgive my ignorance.)

But to hear of Clinton’s position on the matter – now – surprises me none whatsoever.
#276059

On March 31st, 2008 at 12:16 pm, scooter56 said:

i’m confused…..for months it has been your position that the borrowers are irresponsible and should “SUCK IT UP”…. now a Clinton campaign worker made some money sitting on a board and should return the money to irresponsible borrowers…..
#276060

On March 31st, 2008 at 12:16 pm, meatpieandtatters said:

Ah, yes….The smell of cronyism and hypocrisy is the perfume on Hillary the pig. Despite all the power and puffery, she’s still a warthog in all her glory.
#276068

On March 31st, 2008 at 12:28 pm, geminicontender said:

Remember there are no rules, just customs and traditions and Hillary and the Democratics top tradition is HYPOCRISY!
#276073

On March 31st, 2008 at 12:35 pm, Concerned Citizen said:

But CNN reminds us of the other victims of the subprime debacle. I had a hard time holding back tears for these unfortunate folks.

Careers vanish after subprime ‘free fall’
#276080

On March 31st, 2008 at 12:47 pm, zorro said:

The Klinton inner circle could be described as, to paraphrase Chuck Knoll, the criminal element of politics.

Did Ken Starr or Fred’s senate committee try to get Maggie to testify during the Klinton scandal a minute period?
#276097

On March 31st, 2008 at 1:11 pm, AlohaGuy said:

And Delta assessed penalties to borrowers who paid off before their loans matured – a practice Clinton frequently decries on the campaign trail.

“I would eliminate the prepayment penalties that lead to such high rates of default,” Clinton said

Ok, if you can pay off your loan early, but choose not to do so to avoid a penalty, you default, umm, why….? I mean, you have the money to pre-pay, so why would you default? Oh, yeah, just another politician making noises, sorry.
#276098

On March 31st, 2008 at 1:13 pm, Barry F. said:

Hey, how ’bout returning the money earned through practices your boss so despises, Maggie?

This is definitely an instance where one should not hold their breath waiting for it to happen.
#276121

On March 31st, 2008 at 1:48 pm, Azygos said:

Aloha guy,
You beat me to that one also.

Maggie Williams (already tainted by the Johnny Chung scandal) got rich while serving

Sorry, I don’t think $200,000 is “rich” seeing that she probably paid more than 50% in taxes. And if she is living in NYC $100,000 does not go vary far. Sounds like a lot but in reality isn’t that great.

MM,
I thought you were a capitalist? Whats wrong with making money. Was there a person in the room with a gun to the borrowers head making them sign a bad mortgage? What happened to Suck It Up?

I think what the pre-pay clause they may be referring to is some lenders charge 2 to 5 percent of the balance of the mortgage if you refinance prior to 1 year, 2 years passing. So if you sign for a bad mortgage that charges 5 percent and you refinance with someone else within the year, on a $100,000 loan you have to cough up an additional $5,000 to refinance the loan.
#276123

On March 31st, 2008 at 1:49 pm, cabrerski said:

This story need some legs. Everybody should be pounding on their drums. If Williams were forced out, Hillary’s campaign would probably implode beyond repair from the spinmeisters.
#276225

On March 31st, 2008 at 3:01 pm, WarTip said:

To those that are thinking there is hypocrisy here, take into consideration that Clinton is the one decrying the actions of these institutions with sub-prime lending, not our hostess. If Clinton is so dead-set against the practice and finds it to be such an evil incarnate, how is it that she allows people who have gained off the work of those unfortunate and unwitting “victims” who bought much more house than they could afford? Therein lies the problem. Then again, having a Hispanic racist … I mean activist who actively protested Nafta that Hillary supported before she was against it … well, let us just say that hypocrisy is nothing new to the Clinton camp.
#276227

On March 31st, 2008 at 3:02 pm, WarTip said:

Oops, should be;

how is it that she allows people who have gained off the work of those unfortunate and unwitting “victims” who bought much more house than they could afford continue to work in her campaign if they willingly accepted money from the “victims”?
#276301

On March 31st, 2008 at 4:05 pm, gridlock said:

I wound up having to bail out a friend who got a Delta mortgage a few years back. It seems they sold the mortgage to Wells Fargo without every paying off the original mortgage holder, leaving my friend owing both mortgage holders, who both threatened to forclose on her house.

Eventually it all got worked out, but many months and many thousands of dollars later.
#276340

On March 31st, 2008 at 5:22 pm, nyc123me said:

Does this person look sane to you?
#276357

On March 31st, 2008 at 5:56 pm, secondsight said:

The beginning of the end sighted: Philadelphia becomes the first US city to suspend sheriff sales on deadbeat mortgage holders:

The foreclosure crisis that has ravaged some Midwestern cities has not hit Philadelphia – the 469 properties listed for sheriff’s sales in February were significantly less than the 598 in February 2007. And while the United States experienced a 79 percent increase in foreclosures in 2007, the 2,041 homes sold by the sheriff’s office last year was a 7 percent decrease from 2006, according to sheriff’s office figures.

But to Democrats wholesale intervention into contracts is worth any price —

Banks warn against interfering in the foreclosure process. Levy and others say lenders will stay away from places where they cannot count on a mechanism to collect on their loans that are not repaid.

“If you can’t seize collateral, if the moratorium stays in place, then it sets a bad environment for doing residential mortgages,” said Daniel J. Reisteter, vice president of government relations for the Pennsylvania Bankers Association.

http://www.philly.com/philly/news/20080328_Phila__sheriff_s_home_sales_suspended.html
#276377

On March 31st, 2008 at 6:41 pm, mngirl said:

#18

The problem, is that this is the ultimate Hypocrisy on the part of Williams and her boss.

She sat on the board for seven years and did nothing to help the “poor borrowers” suckered into mortgages with prepayment penalties? Seven years.

Said another way, she aided and abbetted one of the worst in the industry. Prepayment penalties are not the norm, they were used by companies to make it harder for borrowers to refinance with other banks when the ARMs matured and interest rates increased.
#276416

On March 31st, 2008 at 8:38 pm, BlameAmericaLast said:

Wow $200K from sitting on a board. How can I get myself on a board?

But seriously, this is typical Clintonista MO. Do as I say, but not as I do. But what’s even more infuriating is the media or the public (with the exception of a few) call them out for it.

As usual, they get away with it once more.

Move along..nothing to see here.