After Securing Commitment To Make Substantial FHA Reforms, Corker Says He Will Support Galante For FHA Commissioner

Tuesday, December 18, 2012

Senator Bob Corker, R-Tn., a member of the Senate Banking, Housing and Urban Affairs Committee, on Tuesday announced that after securing a commitment from Federal Housing Administration Acting Commissioner Carol Galante to make substantial changes to FHA underwriting requirements, he feels comfortable supporting her bid to become FHA commissioner.

Ms. Galante sent Senator Corker a letter Tuesday committing unequivocally to important reforms to be put in place by Jan. 31, 2013. A copy of the letter can be found here.

Senator Corker said, “I’ve been working closely with Secretary Donovan and Acting Commissioner Galante over the past few weeks on ways we can put FHA on sound financial footing. While this is only a first step, I am encouraged that Acting Commissioner Galante has committed to structural reforms that we both believe put FHA in a much stronger position. Given the reforms she is committed to, I believe that having an accountable commissioner with her resolve and expertise will be in the best interest of the taxpayer."  

Ms. Galante has committed to:

· Place a moratorium on the full drawdown reverse mortgage program to assess its viability after $2.8 billion in losses.

· Substantially increase underwriting criteria for borrowers with FICO scores between 580 and 620 by establishing a meaningful maximum debt-to-income ratio. This will dramatically decrease borrower default rates.

· Increase the down payment requirement and the insurance pricing for loans between $625,000 and $729,000 to protect FHA against loss on high balance loans that are outside Fannie and Freddie conforming loan limits. This will also help to scale back the government’s footprint in the housing market.

· Increase underwriting requirements for borrowers who have been foreclosed upon within the last seven years.

Senator Corker has continually expressed concerns over the pace of reforms at FHA, most recently raising several issues with Housing and Urban Development (HUD) Secretary Shaun Donovan at a December 6 banking committee hearing on the state of FHA’s financial condition. A transcript of the hearing can be found here.


Fidelity Trust Remains Bullish On Central Business District; Buying Old Krystal Headquarters On Cherry Street

Fidelity Trust Company has a contract to purchase the old Krystal headquarters at 701 Cherry St., Matt McGauley said. He stated, "We're very bullish on the Central Business District. We already have six buildings there, and this will be our seventh." The three-story business block includes the Cherry Street Diner. The building has 19,000 square feet of space. With the ... (click for more)

Real Estate Transfers For Sept. 4-10

NOTICE: The Hamilton County Register’s Office did not publish this data. All information in the Register’s Office is public information as set out in T.C.A. 10-7-503. For questions regarding this report, please call Chattanoogan.com at 423 266-2325. GI numbers, listed when street addresses are not available, refer to the location of transactions (book number and page number) ... (click for more)

Sewell Says City, EPB "Close" On Amount Owed By Utility To City On Street Light Overbilling

City Internal Auditor Stan Sewell told City Council members on Tuesday that EPB and the city are "close" on the amount owed by the utility to the city on street light overbilling. Mr. Sewell said the city computed the amount at about $1.2 million, while he said EPB's auditing firm, Mauldin and Jenkins, has it at $1.5 million for an 89-month period that was audited. Mr. Sewell ... (click for more)

City Council Votes 5-4 On New Process For Naming IDB Members

The City Council voted Tuesday night 5-4 to set up a new process for naming members to the Industrial Development Board (IDB), which currently has four vacancies. The process includes three City Council panels: A (Districts 1, 2, 3), B (Districts 4, 5, 6), and C (Districts 7, 8, 9). Group A will fill two of the vacancies and Groups B and C one each. Agreement ... (click for more)

Dirt Decision At Camp Jordan May Come Back To Haunt East Ridge Councilmen

Wow. I thought the arrival of Bass Pro Shop would help bring East Ridge back to a position of prominence in the Chattanooga area, but the Council proved otherwise last night.  To the council - There is a reason that the developers want that dirt: It's valuable . You currently own it and the developer wants it. Bass Pro has already agreed to set up shop. They were going ... (click for more)

Roy Exum: I’m Certainly No Expert

Sometime on Monday night, after I had written a piece on getting swatted with a switch as a kid, I got an email from ESPN Canada asking if I would be a televised guest on “Off the Record,” the most watched daily sports show in Canada. The subject: corporal punishment in America. Are you kidding me? I am hardly an expert. All weekend my world of sports and its excitement was warped ... (click for more)