Late Tuesday, in a vote of 57 to 41, the Senate confirmed Obama’s appointment of US Representative Mel Watt of North Carolina as the new director of the Federal Housing Finance Agency (FHFA).
Watt will be the first the FHFA’s first permanent director since 2009, replacing the current acting directors Edward DeMarco.
Watt enjoys the favor of several key groups within the industry, as he has been endorsed by the Mortgage Bankers Association (MBA), the National Association of Realtors, as well as the National Association of Home Builders. The Chairman of the MBA, E.J. Burke expressed his eagerness to see Watt implement reform in the secondary mortgage market, “Fannie Mae and Freddie Mac have been in conservatorship for more than five years, and it’s well past time to move forward on reform.
The FHFA is responsible for regulating the two government sponsored entities. Watt, who will now take charge of the FHFA, has been stated as a “protector” of the American consumer by key members of the Obama Administration, such as Housing and Urban Development Secretary Shaun Donovan, as well as Obama himself. Watt is expected to facilitate the Administration’s hopes for a targeted principal forgiveness program, allowing both GSE’s to reduce mortgage principal (and perhaps even allow for interest rate reductions) for certain borrowers who are underwater on their mortgages.
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