(CNSNews.com) - President Bill Clinton and First Lady Hillary Clinton may have settled on a $1.7 million home Monday in Chappaqua, New York, but securing the necessary loan needed to take possession may be another matter. The Clintons have now encountered a legal challenge to the loan on grounds that the home loan constitutes an illegal political gift.
The Conservative Campaign Fund (CCF) filed a formal Complaint Tuesday with the Federal Elections Commission (FEC) against Mrs. Clinton, her Senate exploratory committee and PNC Mortgage Corporation of America which is financing the Clinton's home loan.
The Clintons are in the final stages of buying a house in New York where Mrs. Clinton is expected to establish residency in the state before seeking to represent New Yorkers in the U.S. Senate.
CCF is concerned that the Clintons have been afforded special consideration which average individuals applying for home loans would not have received under similar circumstances for a $1.36 million home loan.
The loan is a 30-year, adjustable rate mortgage at 7.5 percent, locked in for the first three years, with no points, according to CCF. Real estate experts, CCF maintains, say these terms are not available to others with similar financial situations, nor would others qualify to receive the loan.
PNC Mortgage spokesperson Laurel Krasne told CNSNews.com the company has a "longstanding policy of not discussing customer relations." Krasne did not elaborate on CCF's complaint filed with the FEC against the corporation.
A PNC Mortgage web site, however, indicates the corporation is an "Equal Housing Lender."
"PNC Mortgage made the loan in the ordinary course of business. There was nothing illegal about the loan. Since the matter is in litigation, we cannot comment any further," Krasne added.
CCF Chairman Peter Flaherty said the Clinton's loan is illegal. "There would be no problem if Hillary received a loan on the same terms as any other bank customer. It is obvious, however, that she has received very favorable terms. It is exactly this kind of sweetheart deal with a major corporation that the Federal Election Campaign Act was intended to prevent."
CCF's complaint alleges that PNC's mortgage "constitutes an illegal contribution to a candidate for federal office because the mortgage does not satisfy the requirements of the Federal Election Campaign Act and the Federal Election Commission regulations."
The complaint also alleges that the "terms and conditions of the loan, insofar as details have been publicly revealed, are starkly different from the terms and conditions available to other individuals in a similar fact situation."
The White House currently serves as the Clintons' sole residence since they do not own a home of their own.
With considerable legal bills mounting into the millions of dollars, the prospect of the first couple buying a home worth nearly two million dollars has raised questions concerning their ability to repay such a loan. The only guaranteed income will be the president's pension.
Flaherty said his organization is responsible for foiling the Clinton's first attempt to secure a $1.35 million loan which was secured with the help of Democrat fund-raiser Terry McAuliffe.
McAuliffe's involvement in the Clintons' mortgage also raised questions regarding a potential conflict of interest. Justice Department investigators, working under the ultimate command of the president, were set to question McAuliffe in an upcoming criminal trial of Teamster political director William Hamilton.
CCF subsequently filed a Complaint with the FEC on September 10, alleging the arrangement was illegal on the grounds that it violated federal campaign finance laws. Federal law restricts individual campaign contributions to $1,000 per person per federal election.
The FEC then agreed to investigate the loan, but McAuliffe eventually withdrew his offer, leaving the Clintons to search for other means to finance the loan.
Flaherty is still concerned, however, that the Clinton's latest efforts are still outside the confines of federal election laws.
"I question Hillary's judgment," Flaherty said. "We forced her to back out of the loan guarantee arrangement with McAuliffe. Instead of coming up with a squeaky-clean alternative that could not be criticized, she has now entered into another controversial and illegal loan deal."
New York Republican State Committee Chairman Bill Powers, reflecting on the Clintons' absence during Tuesday's statewide elections, suggested that Mrs. Clinton has little concern about the issues affecting New Yorker voters.
"It appears that Hillary will only vote in New York state if she appears on the ballot," Powers told CNSNews.com.
"This is not just a legal question, this is a question of perception," said Dan Allen NY Republican State Committee spokesman when asked about the arrangements for a home loan. "The Clintons are saying they want to be treated like the average New York family. But if Hillary was really listening to New Yorkers, she would know that the average New York family can't get $1.3 million loan like the Clintons just got."
Numerous CNSNews.com phone calls to Mrs. Clinton's Senate exploratory committee for comment were not returned.