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Tuesday, March 24, 2009

Former Freddie Mac Executive: Obama’s Choice for Federal Housing Administration

Stevens Is Said to Head Obama’s Federal Housing Administration
By Mark Drajem

March 23 (Bloomberg) -- David Stevens, president and chief operating officer of real estate brokerage Long & Foster Cos., is President Barack Obama’s choice to head the Federal Housing Administration, according to people familiar with the selection.

Stevens, a former Freddie Mac mortgage executive, would replace Federal Housing Commissioner Brian D. Montgomery, who was appointed by President George W. Bush. The people familiar with Stevens’s selection declined to comment because the Obama administration has yet to make an announcement.

The FHA, a mortgage-insurance division of the U.S. Housing and Urban Development Department created in 1934, is regaining a larger role in the housing market as private insurers and lenders scale back, raise fees and tighten eligibility criteria. The agency said in a February report that applications tripled to 2.3 million in 2008, from 2007. FHA-insured loans represented 31 percent of new mortgages in the fourth quarter, the highest on record, according to newsletter Inside Mortgage Finance.

Stevens from 1999 through May 2005 managed the single- family mortgage business and sales force for McLean, Virginia- based Freddie Mac, which was seized by regulators in September as a rise in delinquencies on loans the company guarantees or owns eroded capital. He joined closely held Long & Foster of Chantilly, Virginia in 2006 to help run their mortgage lending businesses.

Stevens’s nomination will need to be confirmed by the Senate. He couldn’t immediately be reached to comment. His selection to head the FHA was reported earlier by the Washington Post and Wall Street Journal.
FHA has a $400 billion mortgage portfolio, according to the agency’s Web site.


My Thoughts

More rewarding failure. He would bring what he helped do to Fannie Mac to the whole country. This is like hiring the arsonist as a fire chief.

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