Standing in front of a vacant, foreclosed house in Linden that was in possession of mortgage giant Fannie Mae, Republican U.S. Senate candidate Dick Zimmer blamed incumbent Democrat Frank Lautenberg for complicity in allowing the mortgage crisis to get this far.
The troubled Fannie Mae, he said, a “hybrid” mortgage company — part private and part government owned — suffered from lack of regulation and oversight.
Zimmer said that he was one of a handful of Congressman who opposed a 1992 bill that set up the Office of Federal Housing Enterprise Oversight because he saw the potential of a bailout crisis under the law’s weak oversight powers. The lax regulation allowed Fannie Mae and Freddie Mac to engage in risky business practices, he said.
“I was one of only a small handful of members of Congress who stood up against corporate welfare and voted against the law that put us on the road to the taxpayer bailout of Fannie Mae and Freddie Mac,” said Zimmer.
The vast majority of Congress voted the other way, as did the Senate in a unanimous voice vote. Zimmer stopped short of blaming the mortgage crisis on Lautenberg, and acknowledged that most members of Congress at the time – both Democrat and Republican – were equally complicit.
“If Fannie Mae can’t sell this house for the value of the mortgage, it will bear the loss and so will New Jersey taxpayers who will soon become Fannie Mae’s involuntary business partners as the result of bailout legislation now working its way through Congress,” said Zimmer. “New Jersey taxpayers are now on the hook for the mortgage on this house and trillions of dollars worth of other mortgages because of bad legislation supported by Frank Lautenberg more than 15 years ago and because Senator Lautenberg did nothing in subsequent years to fix that legislation.”
Zimmer selected the house where he held today’s press conference from Fannie Mae’s web site, and did not know the story of how it came to be in possession of Frannie Mae.
Paige Cook, a neighbor who watched the small press conference, said that it belonged to a security guard whose wife had recently passed away. When his mortgage payment jumped $1,000 per month, he couldn’t afford it, and moved in with family in North Carolina before the home was foreclosed.
A campaign spokesperson for Lautenberg could not be reached for comment.