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.


Corker Applauds CFPB Decision To Reopen Mortgage-Disclosure Rule

U.S. Senator Bob Corker, a member of the Senate Banking Committee, on Thursday applauded the decision by the Consumer Financial Protection Bureau to reopen its new Truth in Lending Act-Real Estate Settlement Procedures Act Integrated Disclosure rule for public comment.  Senator Corker sent a letter to CFPB Director Richard Cordray in March requesting increased clarity regarding ... (click for more)

Reimagine Downtown’s Alleyways With Passageways

Presented by the American Institute of Architects, AIA,  Tennessee and River City Company, Passageways is a community outreach project of the 2016  AIA Tennessee State Convention to be held in Chattanooga in August. Currently, submissions are  being accepted on transformative alleyway proposals that activate the urban alley through  architecture.   ... (click for more)

Grocery, Retail, Parking Lots, Multi-Family Proposed To Build Out Lifestyle Way Near Hamilton Place

A grocery store, restaurants, much additional retail, large parking areas, and apartments are planned for 62 acres of the Lifestyle Way development near Hamilton Place Mall. The project by developers Ken and Byron Defoor has long been in the works, and previously has featured an Embassy Suites Hotel and a Mellow Mushroom and office near Shallowford Road long with some retail ... (click for more)

Expansion By Developers Of McCallie Commons Would Raze 3 Old Houses On Oak Street

Developers of the McCallie Commons student housing at McCallie and Central are wanting to expand the project, but it would involve tearing down three old homes on Oak Street. The proposal from developer David Hudson would be an expansion of the four-story apartment building and separate parking garage with 300 parking spaces proposed that was approved earlier. The original ... (click for more)

Marvelous News From Central High School

To Roy Exum:     With all the recent news of major dysfunctions within our educational system, I thought I might alert you to something better. About a year ago you ventured up Highway 58 to Central High School to represent your late grandfather, Roy McDonald, as he was honored as a Distinguished Alumnus during the annual Senior Day festivities. I sort of expected ... (click for more)

Roy Exum: Teachers Day Tomorrow

Years ago at a ritzy dinner party in Westchester County, New York, an editor from Reader’s Digest was seated next to the prettiest woman in the room and noticed her overall glow and countenance was such that he had never noticed a tell-tale scar under her nose. After the dishes were cleared away, admit the mindless chatter, he asked if she would mind telling him about it. The ... (click for more)