Mel Watt Officially Nominated to Head FHFA

Confirming earlier speculation, President Barack Obama this afternoonrnnominated Congressman Mel Watt (D-NC) to be the director of the Federal HousingrnFinance Agency (FHFA).  Watt, who has served in the House ofrnRepresentatives for 20 years, will succeed Edward J. DeMarco who has acted asrndirector through most of the Obama presidency.</p

In announcing the nomination the President said the Congressman “hasrnled efforts to rein in unscrupulous mortgage lenders, he’s helped protectrnconsumers from the kind of reckless risk-taking that led to the financialrncrisis in the first place, and he’s fought to give more Americans in low-incomernneighborhoods access to affordable housing.” </p

Shaun Donovan, Secretary of Housing and Urban Development said he applaudedrnthe President’s nomination.  “Mel bringsrnto this position more than twenty years of expertise on the House FinancialrnServices Committee and two decades in the private sector as a small businessrnowner. He has a proven track record of fighting to rein in deceptive mortgagernlenders, protect consumers from abusive financial practices, and expandrnaffordable housing, as well as to generate bipartisan cooperation to findrncommon ground on key issues.” </p

David H. Stevens, President and CEO of the MortgagernBankers Association offered no opinion on the selection but said Watts had arnbig job ahead of him.  Noting that therntwo GSEs had been in conservatorship for almost five years Stevens said, “It is time to begin transitioning these companies, creatingrna strong secondary mortgage market that relies first and foremost on privaterncapital with a limited government guarantee that can function for the longrnterm. That needs to be the FHFA Director’s number one priority. </p

“In the meantime, in order to sustain the burgeoningrnhousing recovery, the FHFA director ought to ensure that the agency, as well asrnFreddie and Fannie, operate in a completely transparent manner.  Thesernentities currently dominate the mortgage market, and changes they make tornprograms and policies have profound implications for borrowers and lendersrnalike.  That is why MBA has been, and will remain, a loud voice for anrnopen and transparent process that requires FHFA, Freddie and Fannie to publishrntheir proposals and directs them to fully consider input from all stakeholdersrnon important policy matters.”</p

Watt’s confirmation is far from assured.  Several Republican senatorsrnhave already expressed opposition to the appointment including Senator BobrnCorker (R-TN) who sits on the Senate Banking Committee which must vet thernappointment.  Corker said he could not be more disappointed in thernPresident’s pick.

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