Former Representative Mel Watt (D-NC) was sworn in as the director of the Federal Housing Finance Agency (FHFA) on January 6 by Vice President Joe Biden. FHFA oversees Fannie Mae and Freddie Mac, two housing government sponsored enterprises that back most single family mortgages in the United States and, thanks to legislation enacted in 2008, could be the first entity to direct funding into the National Housing Trust Fund.
“I am honored to serve as Director of the Federal Housing Finance Agency,” Mr. Watt said in a statement. “Today’s housing finance system is one of the keys to our economic recovery and I am grateful for the opportunity to help develop a strong foundation for moving this system forward for the benefit of all Americans at this critical point in our nation’s history.”
In remarks at the swearing in ceremony, Mr. Watt expressed appreciation to out-going FHFA Acting Director Edward DeMarco and to the many who had helped him throughout his career. Mr. Watt spoke to his new FHFA colleagues about who he is and how he got there. Mr. Watt described growing up in a home with holes in the roof and with no running water or outdoor plumbing. An army barracks home was trucked in and became his family’s first modern home his family. An African American, Mr. Watt attended segregated schools and drove the school bus to his high school, a trip that went by three white schools on the way to his own. Mr. Watt described turning down scholarship offers for college, opting to go to the University of North Carolina, which offered him the possibility of assistance if he did well the first semester.
When Mr. Watt moved into his first college housing, the three other roommates promptly moved out, presumably because of Mr. Watt’s race. He went on to live with someone who became a lifelong, steadfast friend. After law school, Mr. Watt practiced business law for a firm that mostly focused on civil rights issues. A month after he began at the firm, the office was firebombed. The event gave Mr. Watt the opportunity for a crash course in real estate development as he helped in the rebuilding process. When his two sons were older, Mr. Watt successfully ran for a U.S. House seat, where his mentor in all things financial and housing was former Representative Barney Frank (D-MA), long-time Chair and Ranking Member of the House Committee on Financial Services.
Mr. Watt said that his life experiences have made him intolerant of lending that victimizes people or that puts them in jeopardy of losing what they had worked hard for all of their lives. He also said he is a firm believer in the United State helping people achieve their goals.
NLIHC President and CEO Sheila Crowley issued a statement upon Mr. Watt’s swearing in, expressing confidence that Mr. Watt will give all issues before him a thorough and objective analysis. “I urge Mr. Watt to act swiftly to enforce Fannie Mae and Freddie Mac’s statutory obligation to fund the National Housing Trust Fund. The National Low Income Housing Coalition and many other observers agree that the conditions under which this obligation was suspended in 2008 no longer apply. In the ensuing years as the housing market has recovered such that Fannie and Freddie are now making record profits, the shortage of housing for the lowest income people has only become more severe. The need for the National Housing Trust Fund has never been greater,” Ms. Crowley said.
On January 10, Mr. Watt announced the appointment of four top level staff, all “special advisors” in the areas of intergovernmental, industry, consumer, and agency, indicating that he is reorganizing the staff and moving quickly to make his mark at the beginning of his tenure at FHFA.