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The scandal surrounding the Dodd-Countrywide mortgage bailout bill continues to grow, as news surfaced that Barack Obama received a suspicious deal on a home mortgage in 2005 from Northern Trust in Illinois. The massive $1.32 million loan, nicknamed a "super super jumbo" loan by mortgage lenders, allows Senator Obama to pay preferential, below market rates on his six-bedroom, four-car garage, home that includes a wine cellar and a solarium. This is the same controversial home Senator Obama bought with the help of a sweetheart land deal with convicted felon and political insider Tony Rezko.
While the average mortgage rate in Chicago in 2005 was an estimated 5.93-6 percent, the Obama-Northern Trust deal settled at a generous 5.6 percent. A reduction of this size was particularly favorable considering it did not require an origination fee or points.
For Obama, this discovery only adds fuel to the fire started by Jim Johnson, a close confidant and former senior member of Obama’s presidential campaign team, who abruptly resigned following a press story exposing his participation in the Countrywide "Friends of Angelo" VIP program last June. Since then Senators Chris Dodd (D-CT) and Kent Conrad (D-ND) have both been cited as preferential VIP loan recipients from Countrywide Financial. Senator Obama claims to have been "working with Senator Dodd" on the crafting of the bailout legislation.
Since federal law prohibits public officials from receiving special treatment from lenders, including Senators, these recent discoveries raise troubling questions about the motives behind the Dodd-Countrywide mortgage bailout bill.
FreedomWorks President Matt Kibbe commented:
"When the Chairman of the Banking Committee, the Chairman of the Budget Committee, and the Democratic Senator competing for the oval office are all getting unique treatment not available to the general public, serious ethical issues are raised. Senator Obama needs to fully disclose how and why he obtained a mortgage not available to the general public and the involvement of Tony Rezko in the deal."
The final Senate vote on the Dodd-Countrywide mortgage bailout bill is expected to take place this week. If passed, the mortgage bailout will create $300 billion in new taxpayer liabilities, and allows banks to dump their worst performing and riskiest loans onto the FHA.