Make Harp 3.0 Happen

Advocating for The Expansion of the Home Affordable Refinance Program

Month – March 2013

Easter Recess is Obama’s Opportunity to Replace FHFA Director Ed Demarco

It has been rumored for some time that President Obama would like to replace interim FHFA Director Ed Demarco. Demarco has drawn the ire of the White House and Housing Advocacy Groups for his unwillingness to implement policies that would aid underwater homeowners. As director of the FHFA Demarco has almost sole authority over Fannie Mae and Freddie Mac. For one reason or another Demarco has managed to retain his post for more than 3 years despite clear opposition to his policies from the White House Administration and the U.S. Treasury. There is mounting pressure for the President to appoint a new permanent FHFA director. Last month 45 Democratic Congressmen signed a letter urging the President to replace Demarco. Yesterday Attorney Generals from 9 different states also signed a letter requesting the President to fire Ed Demarco. One of the major reasons Demarco has retained his position is that he is well regarded by Republicans. Under Demarco’s watch the balance sheets of Fannie Mae and Freddie Mac have been stabilized. There is no question that Demarco has improved the bottom line of Fannie and Freddie with his risk averse policies. However, that has come at a great opportunity cost. Millions of American homeowners remain underwater and countless numbers of foreclosures could have been prevented if Demarco had been willing to allow targeted principal reductions and less restrictive limitations on HARP refinances. Replacing Demarco will require Senate confirmation of a new appointee which will prove difficult to attain given Republican opposition. However a path of least opposition exists; make a recess appointment of a new FHFA director during the Congressional Easter Recess. Congress will be on recess from March 25 thru April 5. No confirmation would be needed during a recess appointment. There is pending litigation concerning the constitutionality of recess appointments, however it will take time for those rulings and appeals to fully play out. In the mean time Demarco would be gone and a new FHFA director that is willing to implement policies that actually help underwater homeowners would be in place. Here’s hoping that President Obama doesn’t miss on this Easter opportunity to fire Ed Demarco.

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How to get help from HSBC

In the two plus months since this website was launched there have been numerous complaints left in the comments section concerning HSBC. It is quite evident that HSBC is completely unwilling to work with the underwater homeowners they service. However, I have found a way to get HSBC to help you. Conduct any sort of illegal activity whether it be running a drug cartel or terrorist organization, and HSBC will be more than happy to help launder money from your illegal activities. Yes, it is true, HSBC has helped Mexican drug cartels and al-Qaida, but they won’t help underwater homeowners to afford their bloated payments.

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President Obama and Congress Have Been Derelict on Housing Reform

Four and a half years ago in response to the mortgage crisis the government seized control of Freddie Mac and Fannie Mae. The Federal Housing Finance Agency (FHFA) was created as a regulatory agency and the two government sponsored mortgage giants were placed into conservatorship of the FHFA while the murky waters of the financial crisis of 2008 were navigated. More than 4 years later, little has changed. The aftermath of the financial crisis is still being dealt with and there has been no sign of legislation to reform Fannie and Freddie, or the role of government in the securitization of mortgages on the secondary mortgage markets. Not only has the President or Congress not put forth a plan for Housing Reform, but they have yet to replace Ed Demarco as the acting director of the FHFA. For more than 3 years the FHFA has been led by a man that wasn’t even appointed to the position. During his tenure Demarco has thrown up all sorts of brick walls that have slowed the housing recovery. From not allowing loan modifications unless borrowers were on the verge of foreclosure to strict limits on securtization cutoff dates for the HARP program, Demarco has been thwarting all efforts to aid underwater homeowners since he assumed the position of acting director in 2009. Now Demarco is taking on GSE reform. This week the FHFA unveiled plans to build a single-securitization platform that would include a new business entity that would function in between Fannie and Freddie. It is one thing to allow Ed Demarco to wreck short term policies such as HARP and HAMP, but now he is getting his fingerprints all over the future of mortgage securitization. Perhaps the plan being put forth by Ed Demarco and the FHFA is a good one. Frankly, that is beside the point. Reform of this magnitude shouldn’t be coming from a temporary leader of a government agency. The President and Congress have shown a complete lack of courage in dealing with this problem. And allowing Ed Demarco to be the “problem solver” for Housing Reform is just ludicrous. It just proves how spineless and negligent our current policy makers are.

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