Corker Votes To Confirm Carol Galante To Head FHA

Sunday, December 30, 2012

Senator Bob Corker, R-Tn., a member of the Senate Banking, Housing and Urban Affairs Committee, on Sunday voted in favor of Carol Galante to be an assistant secretary of Housing and Urban Development and commissioner of the Federal Housing Administration.  

Prior to announcing his support for Ms. Galante, who was confirmed by the Senate on Sunday, Senator Corker secured a commitment from her to make substantial changes to FHA underwriting requirements in order to begin restoring financial stability at FHA after substantial losses, primarily from a flawed reverse mortgage program.

“I’m as frustrated as anyone with the losses taking place at FHA and our failure to implement fundamental housing reform, but given Carol Galante’s commitment to make important changes that will help return FHA to its original mission of making affordable loans accessible to qualified first-time home buyers, I voted to confirm her as an assistant secretary of housing and FHA commissioner.  I look forward to working with her as she puts in place the reforms she has promised as well as others that are needed to get FHA back on track,” said Corker.  “The steps that FHA has taken thus far are just a beginning, and going forward, I am fully committed to pushing both Congress and the administration to take up and address the critical issue of structural housing finance reform in this country.”

Ms. Galante sent Senator Corker a letter on Dec. 18, committing unequivocally to the following important reforms to be put in place by Jan. 31:

· Placing a moratorium on the full drawdown reverse mortgage program to assess its viability after $2.8 billion in losses.  This would put a hold on a program that insures reverse mortgages in which people could draw down all of the equity in their homes.

· Substantially increasing 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.

· Increasing 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.

· Increasing 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.  He also continues to work with his colleagues on reforming Fannie Mae and Freddie Mac in order to protect taxpayers from further losses and rebuild the private mortgage market.


Chattanooga Developer Names Referral Agent For Bahamian Island

David Harris of Associated Island Developers, LTD is partnering with Gina Sakich of Signature Brokers to help make island living a reality for Chattanoogans. Mr. Harris purchased Escape Cay, which is a short two-hour flight from Atlanta, in the Bahamas. The island, which consists of 120 acres, will not only provide homes and a resort, but will also be a hub for environmental ... (click for more)

Fall Home And Remodeling Expo Is Aug. 23 And 24

The Fall Home and Remodeling Expo will be next weekend on Aug. 23 and 24, at the Chattanooga Trade and Convention Center. Organizers said, "Come see the latest home products and services and landscaping for your remodeling project or new home." Some of the products to see are kitchens, appliances, countertops, flooring, siding, painting, roofing, outdoor living, pools, etc. ... (click for more)

School Board Delays Decision On Big-Ticket Health Insurance Item For 1 Week

The Hamilton County School Board on Thursday night voted to delay a vote on a new insurance plan for employees until next Thursday. Sandy Hughes, president of the Hamilton County Education Association, said, "I have a difficult time trying to think of what priority in spending is more important than the well-being of your employees and their children...You've not given us enough ... (click for more)

Man Charged In Westview Elementary Rampage Under Treatment At Moccasin Bend

The 22-year-old charged with a rampage through Westview Elementary School is under treatment at Moccasin Bend Psychiatric Hospital, officials said. Aaron Roden had been set for his first court appearance on Thursday morning. Attorney Allen Dunn of the public defender's office said the hearing needed to be delayed. A status court appearance will be Sept. 23 at 1:30 p.m. Sheriff ... (click for more)

Black Creek TIF Decision-Who Guards The Hen House? - And Response

Citizens of Chattanooga were invited to give public comment before their own Industrial Development Board Aug. 15. They arrived to find foxes guarding their hen house.  Many thought the meeting was their opportunity to seek redress in the ill-conceived Black Creek Tax Increment Financing plan. However, they learned it was a sham orchestrated by both the past and present ... (click for more)

Roy Exum: Let’s ‘Pay It Forward’

At 7 a.m. on Wednesday morning, this at a Starbucks coffee store located at 2186 Tyrone Blvd. in St. Petersburg, Fla.,  an unidentified woman who was first in line at the drive-through window, politely told the drive-through window clerk she would like to “pay it forward.” The clerk checked the next order – it was a caramel macchiato – and the first customer paid for both her ... (click for more)