Confirming earlier speculation, President Barack Obama this afternoon
nominated Congressman Mel Watt (D-NC) to be the director of the Federal Housing
Finance Agency (FHFA). Watt, who has served in the House of
Representatives for 20 years, will succeed Edward J. DeMarco who has acted as
director through most of the Obama presidency.
In announcing the nomination the President said the Congressman "has
led efforts to rein in unscrupulous mortgage lenders, he's helped protect
consumers from the kind of reckless risk-taking that led to the financial
crisis in the first place, and he's fought to give more Americans in low-income
neighborhoods access to affordable housing."
Shaun Donovan, Secretary of Housing and Urban Development said he applauded
the President's nomination. "Mel brings
to this position more than twenty years of expertise on the House Financial
Services Committee and two decades in the private sector as a small business
owner. He has a proven track record of fighting to rein in deceptive mortgage
lenders, protect consumers from abusive financial practices, and expand
affordable housing, as well as to generate bipartisan cooperation to find
common ground on key issues."
David H. Stevens, President and CEO of the Mortgage
Bankers Association offered no opinion on the selection but said Watts had a
big job ahead of him. Noting that the
two GSEs had been in conservatorship for almost five years Stevens said, "It is time to begin transitioning these companies, creating
a strong secondary mortgage market that relies first and foremost on private
capital with a limited government guarantee that can function for the long
term. That needs to be the FHFA Director's number one priority.
"In the meantime, in order to sustain the burgeoning
housing recovery, the FHFA director ought to ensure that the agency, as well as
Freddie and Fannie, operate in a completely transparent manner. These
entities currently dominate the mortgage market, and changes they make to
programs and policies have profound implications for borrowers and lenders
alike. That is why MBA has been, and will remain, a loud voice for an
open and transparent process that requires FHFA, Freddie and Fannie to publish
their proposals and directs them to fully consider input from all stakeholders
on important policy matters."
Watt's confirmation is far from assured. Several Republican senators
have already expressed opposition to the appointment including Senator Bob
Corker (R-TN) who sits on the Senate Banking Committee which must vet the
appointment. Corker said he could not be more disappointed in the