President Obama To Nominate Mel Watt Director Of FHFA

President Obama on Wednesday announced he will nominate Rep. Mel Watt, D-N.C., as the next director of the Federal Housing Finance Agency.

Watt serves on the House Financial Services Committee and on that panel’s subcommittee on capital markets and government-sponsored enterprises. As FHFA director, he would exercise direct control over the regulation, supervision and conservatorship of Fannie Mae and Freddie Mac.

NAFCU Executive Vice President of Government Affairs Dan Berger said Watt, who has spoken before the association’s Congressional Caucus, has always been accessible and open to credit unions and NAFCU. “Rep. Watt is a respected member of Congress, and we appreciate his willingness to meet with credit unions and to hear their concerns,” Berger said.

Watt has previously supported legislation to establish mortgage “cramdowns” under the U.S. bankruptcy code, but that legislation, strongly opposed by NAFCU, ultimately failed multiple congressional attempts at passage. Meanwhile, the administration has been pressing – unsuccessfully, so far – the FHFA to allow some principal forgiveness on underwater mortgages held by Fannie and Freddie.

NAFCU has concerns about opening the door to principal reduction and has warned lawmakers and the administration that such a move would impose undue risks on credit unions and, by extension, their memberships.

If confirmed as director of FHFA, Watt would replace Ed DeMarco, who has held the director post in acting capacity since 2009.

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