Sen. Fort Warned of Sub-Prime Crisis

With financial repercussions being felt around the world and thousands of jobs being lost -- including 1,000 in the Atlanta metro just this week -- many believe the country's mortgage crisis could usher in a new recession.

But one Georgia lawmaker rang the alarm years ago that sub-prime lenders were destroying the economy.

State Sen. Vincent Fort (D-Atlanta) warned his colleagues under the Gold Dome and the public in a long series of town hall meetings that predatory lenders were unraveling the fabric of the American dream.

Indeed, today the country's mortgage crisis has become a bona fide nightmare.

"It's going into other parts of the economy: construction, housing supplies, appliances, that kind of thing," said Sen. Fort. "And then it's even going international: European markets, Asian markets are at risk because these sub-prime loans were so shaky."

Nearly 1,000 people lost their jobs after Metro Atlanta's HomeBanc went into bankruptcy, another casualty of the mortgage industry collapse despite the fact that they were not sub-prime lenders.

"Interestingly enough HomeBanc was one of the most active in opposing a strong predatory lending bill so it's just ironic that this company that didn't want any changes to the law to protect consumers is now in bankruptcy," said Fort.

While the senator, along with Legal Aid attorney Bill Brennan, has been able to step in and stop the foreclosures of several homes over the years, Fort said governments are going to have to intervene to stop more families from losing their homes during the mortgage crisis.

"In order to stem the tide in this financial bloodletting, I would hope the federal government or even the state government do something to modify these loans to reform these loans in a way where consumers can stay in their houses," said Fort.

Fort led the charge back in 2002 to pass the state?s anti-predatory lending law, only to see it gutted four months later by the new legislature. He said that it is hard to calculate how many homes could have been saved had the law not been weakened.

He added ominously that he believes the financial tsunami is not over yet, and that other companies will eventually pay the price for unregulated greed.