Part Two of the housing debacle is about to hit now that Sen. Hillary Clinton has politely stepped aside so Sen. Barack Obama can continue to capture the hearts of America and pick his vice presidential running mate, to get the show moving forward.

How does the housing and mortgage crisis intertwine with the election, you might ask? That's simple. The obvious issue to use against Sen. John McCain is housing and mortgage implosions, right? Try to tie McCain to the Bush administration's inability to lasso in the worst economic situation we've faced in modern history.

So why hasn't Obama announced his vice presidential running mate and come out with guns blazing? Consider the following.

In reports issued last week by www.portfolio.com, it was revealed that key leaders within the Democratic Party were given preferential treatment by Countrywide Home Loans, Inc., chairman and chief executive officer Angelo Mozilo. Countrywide is the current poster child and face of the subprime mortgage debacle.

The most notable senator to receive the "FOA" (Friends of Angelo) discount is Christopher Dodd, D-Conn., who, according to the reports, received a three-eighths percent fee reduction on a townhouse in Washington, D.C. The senator will save about $2,000 because of the reduction.

That's a pretty nice stimulus check.

Dodd was jockeying for position to become Obama's vice presidential running mate. He is chairman of the Senate Banking Committee, the same committee charged with regulating the mortgage industry.

Dodd helped shape the current proposal to bail out mortgage lenders, calling Countrywide's practices "abusive" earlier this year.

Additionally, Obama lost the head of his vice presidential search team, Jim Johnson. Johnson was the former chairman of Fannie Mae, the large government-sponsored agency that purchased loans from Countrywide for the past two decades.

Fannie Mae called Countrywide a "top customer" in its most recent quarterly report; 28 percent of Fannie Mae's portfolio of loans came from Countrywide.

Johnson got the "FOA" discount too, which resulted in his voluntary resignation from Obama's search team a week ago.

Another senator, Kent Conrad, D-N.D., received a loan from Countrywide after being referred to Countrywide by Johnson. Conrad also got the "FOA" discount. In fact, Conrad apparently received some very special treatment; Countrywide financed an eight-unit apartment building for him, even though the company's guidelines explicitly state that it will finance only one- to four-unit properties.

The senator also received a full one-point discount on a $1 million loan against his second home, saving him approximately $10,000 per year in interest payments.

Conrad denies receiving any special treatment, but has nonetheless offered to refinance the loan and contribute $10,500 to Habitat for Humanity, according to his Web site.

The senator also owned shares of Fannie Mae as recently as 2006 (which is the most recent financial disclosure available), and the interest rate he received on his eight-unit apartment building through Countrywide was 5.75 percent on a 30-year fixed-rate mortgage.

Ask your commercial banker if you can get a 30-year fixed-rate loan against an eight-unit apartment building, and then ask if you can get a 5.75 percent interest rate.

Try not to let the door hit you on the way out.

Conrad also sits on the Finance Committee for the Senate and endorsed Obama in December of last year. It was the first time Conrad ever has endorsed a presidential candidate in his 20-plus years of public service.

What's particularly interesting about Conrad's situation, however, is that he chairs the Finance Subcommittee on Taxation and the IRS Oversight Committee.

There has been speculation that Countrywide's Mozilo knew his company was in trouble and, as a result, began selling the company's stock several years ago, leaving many to call for an investigation by the IRS Oversight Committee (Conrad's specialty.)

Since 2001, Mozilo has garnered about $200 million from the company, and the company's stock price has fallen — from $39 a share a year ago to just under $5 most recently.

Countrywide currently is being purchased by Charlotte-based Bank of America.

According to the reports from www.portfolio.com, many other prominent Washington insiders were recipients of the "FOA" discount, including former Secretary of Housing and Urban Development Alphonso Jackson and former Assistant Secretary of State Richard Holbrooke — a former adviser to the Hillary Clinton campaign.

Incidentally, the Department of Housing and Urban Development and the Federal Housing Administration were most recently handed the task of "fixing" this mortgage mess.

Senate rules prohibit any member from accepting gifts larger than $100 from private entities employing a registered lobbyist — which Countrywide certainly does.

Where does this leave Obama? With a very difficult choice of running mates, as the mortgage mess continues to filter down, eliminating potential candidates when Obama needs one most.

The time to strike is now, yet Obama cannot pull the trigger due to backroom deals that McCain's camp will surely capitalize upon.

Hang tight, folks. There likely will be a Part Three, and maybe even a Part Four, to this mortgage meltdown.

It all makes for great elections, though.

Christian Ola is a Butler Eagle columnist and has 16 years' experience in mortgage lending, as a mortgage auditor, underwriter and small business owner. He also teaches finance at Butler County Community College.