Monday, October 13, 2008

The Golden Goose


As ACORN ran its campaigns against local banks, it quickly hit a roadblock.
Banks would tell ACORN they could afford to reduce their credit standards by
only a little - since Fannie Mae and Freddie Mac, the federal mortgage giants,
refused to buy up those risky loans for sale on the "secondary market."

That is, the CRA wasn't enough. Unless Fannie and Freddie were willing to
relax their credit standards as well, local banks would never make home loans to
customers with bad credit histories or with too little money for a
downpayment.

So ACORN's Democratic friends in Congress moved to force Fannie Mae and
Freddie Mac to dispense with normal credit standards. Throughout the early '90s,
they imposed ever-increasing subprime-lending quotas on Fannie and Freddie.

But then the Republicans won control of Congress - and Rep. Roukema scheduled
her hearing. ACORN went into action to protect its golden goose. ...

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