Comments on: Ed DeMarco Wins the Gold in New Event: Stonewalling on Principal Reduction

By: Manu

Manu — Fri, 10 Aug 2012 17:58:48 +0000

Finally got around to this. They are trying but without creativity. E.g., they are still using the ReFi process with its slow and complex paperwork, involvement of banks, etc.

Couldn’t FHFA/Fannie/Freddie voluntarily lower interest rates on existing mortgages? All the data should be with these lenders. The only loser in this approach are banks who don’t get refi money.

By: Trent

Trent — Wed, 01 Aug 2012 14:57:26 +0000

Right, so for the first time since he managed to crawl out of the hole he was born in, Turbo Tax Timmy is looking out of the taxpayer and Demarco is working for the banks…… You people amaze me, something else is afoot here.

By: Jared Bernstein

Jared Bernstein — Wed, 01 Aug 2012 14:42:13 +0000

They’ve actually been trying to do a lot more of that sort of thing, including working with Fan/Fred–see part in here on HARP:
http://www.whitehouse.gov/sites/default/files/sperling_housing_remarks_-_05_15_12_-_final_for_release.pdf

By: Manu

Manu — Wed, 01 Aug 2012 13:28:45 +0000

Jared – a simple question. The worst affected homeowners cannot refinance to today’s low interest rates. Fannie and Freddie own most of those loans and credit is cheap.

Why is the administration’s plan to not just reduce interest rates for homeowners unable to re-finance? This is a LOT more acceptable than write-offs which clearly create moral hazard, and are less likely to be popular in general public and LOT harder to implement? Again, all FNM and FRE have to do is look at the mortgages they own that have >5% rate and automatically adjust down interest rates.

This will not be popular with the financial industry that makes a lot of money doing re-fis. It’s a lot tougher to see Republicans or moralists standing in the way of such a proposal.

By: David

David — Wed, 01 Aug 2012 09:09:07 +0000

If you are seriously underwater, the strategic thing to do is to walk away from the house. The fact that few people are doing this says that the risk of “strategic defaults” is very low.

I don’t know who vetted DeMarco before offering him the job, but whoever it was didn’t ask some very important questions.

I’m with Krugman. Make a recess appointment of a Director who understands his role. Do it now.

By: Shedlight

Shedlight — Wed, 01 Aug 2012 00:36:37 +0000

A google search shows Mr. Edward J. Demarco to be one of the biggest holders of foreclosed properties in the U.S.–150,000 homes. Is this what affects his judgement? We the people through our Government own Fannie & Freddie and decisions should be made based on the whole economy’s needs. The big picture presents an economy in a soft depression with many more homes to go on the “block” if relief isn’t made available. States are very stressed financially because of Housing Problems too.
In my opinion this new program should have been available from the start of the crisis. The banks need to take a “haircut” on fraudulently developed mortgages as do the relevent bond holders. Government (us) can help, but they must take their lumps. Their insolvency is so large that this can be only a drop in the bucket.
It will be a long time before homes recover their 2007 values (unless we have hyperinflation). Let’s not become Japan.

By: Larry Signor

Larry Signor — Wed, 01 Aug 2012 00:33:48 +0000

Perhaps this man is padding his Romney resume, before he gets fired for complete idiocy.

By: Rima Regas

Rima Regas — Tue, 31 Jul 2012 21:16:15 +0000

Why hasn’t he been fired? Obama’s nominee was a victim of GOP obstruction, like many others. Let this agency be headless in name and another career bureaucrat run it as acting-chief!