Harris brings California housing crisis expertise to the Dems' ticket
Kamala Harris, the Democratic vice presidential candidate, brings strong credentials to the table when it comes to housing and mortgage equality issues, according to her supporters within those areas.
"She had some real on-the-ground experience during the mortgage crisis as the attorney general," said Adam Briones, director, economic equality for the Greenlining Institute, an Oakland, Calif.-based advocacy group.
Harris has some bona fides in coming from California, a state where home affordability and availability have been long-term issues. California was also hit hard by foreclosures during the financial crisis; large numbers of borrowers there had pay-option adjustable-rate mortgages and many ended up underwater on their property.
During her term as attorney general, from 2011 to 2017, Harris was able to negotiate for the state to receive a larger portion of the $25 billion nationwide settlement with five servicers over their use of "robo-signing" on foreclosure documents.
Three of the servicers agreed to separate commitments with California: Wells Fargo, JPMorgan Chase and Bank of America; the other two companies involved were Citigroup and Ally Bank (which emerged from the remains of General Motors' financial services business). Harris negotiated for $20 billion in relief for the state's homeowners, in addition to $410 million that went to the state.
However, Briones added, Harris also faced criticisms for how she handled the OneWest situation, in which she decided against pursuing a civil enforcement action against the bank for illegal foreclosure practices.
OneWest was controlled by current Treasury Secretary Steven Mnuchin when Harris declined to pursue further action against the company. The California Attorney General's office investigation was in 2012 and 2013, prior to Mnuchin's IMB Holdco selling OneWest to CIT Group in 2015. Ironically, Harris was the only Democratic senate candidate in 2016 to receive a contribution from Mnuchin, a Keefe, Bruyette &Woods report on her candidacy noted.
OneWest was sued in 2016 by a pair of California consumer groups on allegations of redlining; the bank settled those claims in 2019.
Then there are her stated goals as a candidate. Harris' focus on racial equality and closing the racial wealth gap included the pledge during her presidential candidacy to establish a $100 billion program to help Black families and individuals purchase homes.
"Just having a vice president that has real direct experience negotiating foreclosure agreements with banks, holding them accountable and frankly, being able to learn from that direct experience is very valuable," Briones said.
But, KBW took a more critical eye towards Harris. While it noted that Harris "does not have the same history with the financial sector as Sen. Elizabeth Warren," the report states that "after Warren, we ranked Sen. Harris as among the more negative possible candidates for financial stocks based on her work as California attorney general and her financial transaction tax proposal," said Brian Gardner, an analyst.
Harris proposed the transfer tax during her campaign in 2019 as a way to pay for a Medicare-for-all plan, which so far has not gained any traction in Congress.
The report noted that Harris had limited experience with the financial sector while in the Senate, given that she was not on the Banking or Finance Committees.
However, Gardner pointed out Harris voted against the Dodd-Frank regulatory reform legislation, S. 2155, adding that when she was running for president, she supported its repeal.