Rep. Mel Watt (D-N.C.) will take over as head of the Federal Housing Finance Agency, following a Senate vote yesterday.
Watt was nominated by President Barack Obama to take over the agency last spring, but Democrats had been unable to muster enough Republican votes to overcome a Republican filibuster that had prevented a vote on his nomination. A recent, controversial change to the Senate rules governing filibusters cleared the way for yesterday’s vote. Two Republicans – Sens. Richard Burr (R-N.C.) and Rob Portman (R-Ohio) – crossed party lines and voted to confirm him in the 57-41 final tally.
The FHFA was created during the financial crisis to oversee Fannie Mae and Freddie Mac following the government takeover of the entities. Since 2009, it has been headed by former bureaucrat Ed DeMarco, who had attracted much admiration from many in the housing industry for his unwavering focus on getting the agencies back in the black. DeMarco resisted efforts by Congressional Democrats and the Obama administration to encourage Fannie and Freddie to write down the principle amounts owed on distressed loans when performing loan modifications.
Advocates for distressed homeowners and affordable housing hope that Watt will be more open to such tactics, and welcomed his ascension to the post.
"This long-awaited confirmation is welcome news to millions of homeowners across the country who need a responsible and vigilant housing regulator," Wade Henderson, president and CEO of The Leadership Conference on Civil and Human Rights, said in a statement. "Congressman Watt is an advocate for struggling homeowners. With 40 years of experience in the housing sector, he has the depth of knowledge to grasp the problems that plague Fannie Mae and Freddie Mac and the skills to work with all stakeholders to right the housing market."
Watt’s confirmation marks "a great day for the millions of low-income Americans in need of decent, affordable homes," National Low Income Housing Coalition President and CEO Sheila Crowley said in a statement. "I am confident that Mr. Watt, an early supporter of legislation to establish the National Housing Trust Fund, will make sure that Fannie Mae and Freddie Mac provide needed support to affordable housing."
The housing industry appears ready to work with Watt.
"MBA has had a longstanding relationship with Congressman Watt, and has had the chance to engage him directly on a number of occasions since his nomination was announced. MBA would be ready and willing to work with him in his new capacity to provide technical support and expertise as he oversees the restructuring of the secondary mortgage market," E.J. Burke, chairman of the Mortgage Bankers Association, said in a statement supporting the nomination.
Rep. Jen Hensarling (R-Texas), who has co-authored a bill that would abolish Fannie and Freddie, singled out DeMarco for praise in his remarks on the hearing and said he hoped that the passage of Watt’s nomination would enable the Obama administration to move forward with permanent plans to reform the agencies.
