Update: Congresswoman denies foreclosure report

Update: California Rep. Laura Richardson today denied a published report that her $535,000 Sacramento home had slipped into foreclosure, saying she had renegotiated her loan to keep the home.

The house "... is not in foreclosure and has NOT been seized by the bank," Richardson, a Democrat from Long Beach, said in a statement. "I have worked with my lender to complete a loan modification and have renegotiated the terms of the agreement -- with no special provisions." (Richardson's entire statement is at the bottom of this article).

Earlier, Capitol Weekly reported that Richardson walked away from the mortgage on her $535,000 Sacramento home, letting the house slip into foreclosure and disrepair less than two years after she bought it with no money down.

"While being elevated to Congress in a 2007 special election, Richardson apparently stopped making payments on her new Sacramento home, and eventually walked away from it, leaving nearly $600,000 in unpaid loans and fees," the publication reported.

Richardson declined to comment for the Capitol Weekly story. Her office issued a written statement Wednesday afternoon.

Capitol Weekly, citing tax records at the Sacramento County assessor's office, reports "... in January 2007, Richardson took out a mortgage for the entire sale price of the house -- $535,000. The mortgage amount was equal to the sale price of the home, meaning she was able to buy the house without a down payment, even though the housing market was beginning to turn. A March 19, 2008 notice of trustee's sale indicates that the unpaid balance of Richardson's loan, which is held by Washington Mutual, is more than $578,000 –- $40,000 more than the original mortgage."

In addition to 100% financing on the home itself, the report quotes the woman who sold the house to Richardson as saying she also gave Richardson $15,000 toward closing costs.

The weekly reports that Richardson's residence quickly became an eyesore, angering neighbors. The report says she recused herself on two key House votes on government efforts to address the foreclosure crisis.

Richardson's statement, however, said she did not recuse herself from those votes, and was instead absent from the House.

Click below to read the entire Richardson statement.

CONGRESSWOMAN LAURA RICHARDSON

For Immediate Release
May 21, 2008

The story published in the Capitol Weekly regarding residential property that I own in Sacramento requires clarification.

Within a 12-month period last year (2007-2008), I was a member of Long Beach City Council, the District Director for California Lt. Gov. Cruz Bustamante, a member of the California State Legislature, and, now a member of Congress. While the transitioning has impacted me personally, the residential property in Sacramento California is not in foreclosure and has NOT been seized by the bank.

I have worked with my lender to complete a loan modification and have renegotiated the terms of the agreement -- with no special provisions. I fully intend to fulfill all financial obligations of this property.

On two housing bills that were cited by the Capitol Weekly, the allegation is that I recused myself from these votes. I did not. I was absent from Washington, D.C., and my duties in the House of Representatives due to the untimely death of my father and his subsequent funeral in California.

I understand that these homeownership issues are a reflection of what many Americans are going through as they fight to keep their homes and to remain financially stable.

Comments

[james]

Interesting...

take it from the man!

if she is stupid and didn't know what she was doing, should not be in congress
if she is smart and was going for the quick flip, and when it went sideways, she walked... then she should pay up.

how about garnishing her wages to pay off mortgage??

[THIMMESCH]

It's Bush's fault!!!

Am I first?

[James]

So are you saying that there is another swindling crook in congress with no ethics, no sense of responsibility, and no scruples? She is just one of many swindling crooks in congress.

[Mike Hunt]

It does not matter what she does in her personal life. She is a Democrat. Therefore she is excused from all normal cultural taboos.

[Dave]

Why is it that I have to read half a story to find out that this woman is a Democrat? Had she have been Republican, the headline would have been: Report: Republican California Congresswoman walked away from $578K mortgage. Why is this always the case?

[Grace]

Democrats : no personal responsibility - no accountability. Walk away and let the government take care of it.

It's how they live. It's how they govern. Here's your proof.

[John Waynesworld]

Maybe she needed the money for food.

[MOJO3]

How tragically sad. And to think...she purchased such an expensive house with absolutely NO MONEY DOWN! Pretell...what in the world was she thinking about?

To add insult to injury...the article also stated the maintenance on her property wasn't up to par. Speaks volumes about this lady--a congresswoman at that! Geeeeeeeeeeeeeeeeeeeze! :(

[Patrick C.]

She is just another Democrat looking for a free ride from honest taxpayers and homeowners.

[Mark Smith]

Unless she made a lot more than a Congressman, she almost certainly used a stated income or no-doc loan. I would be extremely interested to see her closing docs and find out if this elected representative committed mortgage fraud by overstating her income.

[Wow]

And these morons run the country...

[average joe]

another do as i say not as i do liberal... yup got to love them elitists

[Mark]

Being a Democrat of course she isn't held to the same standards as any other normal, responsible American.
Since the current Democrat congress has been in charge and their approval numbers have reached a record low, things have only seemed to get worse.
How do we respond? by wanting to elect more of the same.
What is wrong with people???

[Lou Voren]

I am not at all surprised. Congress is inherently irresponsible. Why are we not surprised with this?

I am sure that this Congresswoman also supports government bail-outs for people who were too stupid to read the loan agreements before they entered into the transaction.

[Jimmy]

It just proves you don't have to be too smart or too honest to be elected in California. This cheat probably got a neg am loan because she couldn't afford the mortgage otherwise. This person deserves no sympathy. She had nothing to lose except whatever good name she had, but, hey, who cares - this is California - home of the fruits and nuts.

[Paul]

She must be dumb, did get enough payola from lobbyists to pay off the mortgage. She should have borrowed some $$$ from that other Dem that had all cash stashed in his freezer!

[Russ]

George Bush Did it! George Bush did it! It's all Bush's fault. Sheesh, where has personal responsibility gone to in this Country?

[Stan_DC]

I'm impressed, they mentioned she was a democrat in the third paragraph! Fortunately someone so inept with finances as she is not playing with our tax dollars. Oh wait, OH OH OH S***, she IS playing with our money! Wonder how the dems are going to spin this one!

[Scott]

So... I forget, what does $535,000.00 buy you in Sacramento, California?

What she in a dive before her "rise" to congress and given the option, she "moved up" so something government provided as part of her "position"?

There are so many other questions this story does NOT ask... I mean, where is she NOW? I know I couldn't walk away from my house and just go on living the good life while ducking my house payments.

What's the REST of the story?

Scammer? Sounds like it. Cheater? Almost certainly. Unethical? She's a Politician now, it's expected.

Candidate for office removal? Without a doubt !!!

S

[Eagle1]

Let us all hear how this is Bush's fault. This is a typical situation where idividuals are not willing to accept responsibility for their poor choices in live and expect someone else to fit the bill. Liberal Democrats are the reason for the current problems. Get refine or drill for oil in our own back yard. Keep depending on these liberals while they rule on high and we get the scraps. Can anyone spell USSR. That's where we are going.

[Dave G]

You people are very stupid. Don't you know that she is an elected official and she has special privileges that we average citizens could never understand?

She and her superior colleagues are far superior the rest of us and she is far too busy worrying about the NFL tape scandal or whether Karl Rove sent telepathic messages to spy on the Governor of Alabama.

Of course she should not be required to pay her mortgage. She's in Congress.

How dare you idiots question her.

You people are just down right DUM. D-U-M! DUM!

[Doug]

WaMu should do a judicial foreclosure. Would cost some legal fees but they would surely win and then could collect any deficient balance from the Honorable Congresswoman.

[Schratboy]

What! A bum legislator? 99% of these elected so-called leaders are reprobates and thugs.

[Darren]

Yes, of course she is a Democrat. Everyone knows Republicans have never done anything sleazy or unethical !!!

Geeez, give it a rest, people. Doesn't it ever get at all tiring to you to cherrypick every piece of news that supports your narrow view of the world while discounting or ignoring everything that does not?

[Gilc]

I'm sure it's President Bush's fault. It's gotta be, it cannot possibly be her fault. Nope. I'm sure the evil genius Bush had something to do with it. Yes sir. He's a crafty one he is.