Ted Lieu reacts to financial crisis

... by urging Gov. Schwarzenegger to sign his bill on lending reforms. From his statement:

Several states have passed effective laws that, had they been in place, would have prevented predatory practices and the making of massive numbers of bad loans.  The largest state in the nation, California, is on the verge of passing its own mortgage reform law (AB 1830), assuming California's Governor listens to the people and not a small minority of those in the industry who continue to believe we should do nothing. 

We need to reform this broken mortgage system.  Taxpayer bailouts do not reform the system, they just prolong the pain.  What we need are effective, common-sense regulations, such as those contained in Assembly Bill 1830 on mortgage reform, to become law.  Enough is enough.

AB 1830 would ban steering homebuyers into higher-priced loans than the ones they qualify for, and would put limits on pre-payment penalties, among other things. Consumer groups are generally supportive of the bill, though they wish it had gone farther, while associations that represent Realtors and mortgage brokers are opposed.

One other note: Lieu, D-El Segundo, seems to have had a change of heart on taxpayer bailouts. Last year, he offered a bill to set aside state money to bail out failing mortgages. The bill died. This year there was no money around to even consider spending on such a thing, so Legislative Democrats focused on regulatory reforms instead.