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.


Planning Agency Staff Recommends Denial Of Request For Doctors Office, Pharmacy On Shallowford Road

The Regional Planning Agency staff is recommending denial on a rezoning request for a doctors office and pharmacy at 7683 Shallowford Road. Wanda Threat is making the request. The staff said it is not in accord with the Land Use Plan. The approximately 1.2-acre site would only have access from Shallowford. The plan is to use an existing building for phase 1 and eventually ... (click for more)

8 Apartments, Commercial Space Planned At Corner Main Street, Central Avenue

A developer is proposing eight second-story apartments and 7,500 square feet of commercial space at the northeast corner of Main Street and Central Avenue. The site being developed by Richard Zavala is just over half an acre. The main entrance will be on Cemetery Avenue and secondary access through an alley. The two-story building will front both Central Avenue and East ... (click for more)

State's TNReady Testing Program Has "Severe Network Outage"; Testing To Be By Pencil And Paper

Tennessee Education Commissioner Candice McQueen said Monday afternoon that the state's TNReady testing program had suffered "a severe network outage." Commissioner Edwards said the testing will go on, but it will have to be done with pencil and paper. She sent this email to school directors across the state: Directors, Thank you for your patience as we faced technical ... (click for more)

Brandon Bettis, 25, Arrested For Home Invasion; 2 Other Suspects Being Sought

Brandon Bettis, 25, was arrested after a home invasion early Monday morning, and two other suspects are being sought. Chattanooga Police responded to the 1100 block of Thomas Lane at 6:30 a.m. on the report of a home invasion robbery.  The suspects entered the home of the victims, James Shrum, 47, and Hillary Schooley, 25.   The victims were wakened and threatened ... (click for more)

The City Failed To Watch The Chattanooga History Museum Dollars - And Response (3)

The tell tale signs of the History Museum's folly have been evident for years. When I was a former member of City Council I interviewed Dr. Daryl Black, Ph.D. to determine if I should argue for or against the annual funding of his organization. His interview, the multi-year history of administrative non-performance (despite consistent repetitive funding), and a review of the organizational ... (click for more)

Roy Exum: Greenholtz: A No-Brainer

I am going to make this as simple as I possibly can. There are three fine lawyers now running for Criminal Court Judge and anywhere you go there will be people who like and admire Tom Greenholtz, Boyd Patterson and Mike Little. But when we select a judge, it should never be based on popularity. That’s why Gov. Haslam picked Greenholtz over both Little and Patterson this summer to ... (click for more)