Hal's Mortgage Blog

Congress sees one of its own become a mortgage “victim”. Rep. Laura Richardson (D-CA) spent her money on financing her campaign instead of making her mortgage payments. She borrowed $177,500 against equity in her Long Beach home, then purchased another home in Sacramento for $535,500 with a no money down subprime loan.

The Long Beach property went into default March 28 but she was able to arrange a loan modification. She wasn’t so lucky with the Sacramento property. It sold at a foreclosure auction May 7 for $388,000 and the lender took a loss of nearly $200,000.

Who gets the black eye here? Will it be the “evil” mortgage company or the irresponsible borrower?