After Securing Commitment To Make Substantial FHA Reforms, Corker Says He Will Support Galante For FHA Commissioner

Tuesday, December 18, 2012

Senator Bob Corker, R-Tn., a member of the Senate Banking, Housing and Urban Affairs Committee, on Tuesday announced that after securing a commitment from Federal Housing Administration Acting Commissioner Carol Galante to make substantial changes to FHA underwriting requirements, he feels comfortable supporting her bid to become FHA commissioner.

Ms. Galante sent Senator Corker a letter Tuesday committing unequivocally to important reforms to be put in place by Jan. 31, 2013. A copy of the letter can be found here.

Senator Corker said, “I’ve been working closely with Secretary Donovan and Acting Commissioner Galante over the past few weeks on ways we can put FHA on sound financial footing. While this is only a first step, I am encouraged that Acting Commissioner Galante has committed to structural reforms that we both believe put FHA in a much stronger position. Given the reforms she is committed to, I believe that having an accountable commissioner with her resolve and expertise will be in the best interest of the taxpayer."  

Ms. Galante has committed to:

· Place a moratorium on the full drawdown reverse mortgage program to assess its viability after $2.8 billion in losses.

· Substantially increase 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.

· Increase 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.

· Increase 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.


Chattanooga Developer Names Referral Agent For Bahamian Island

David Harris of Associated Island Developers, LTD is partnering with Gina Sakich of Signature Brokers to help make island living a reality for Chattanoogans. Mr. Harris purchased Escape Cay, which is a short two-hour flight from Atlanta, in the Bahamas. The island, which consists of 120 acres, will not only provide homes and a resort, but will also be a hub for environmental ... (click for more)

Fall Home And Remodeling Expo Is Aug. 23 And 24

The Fall Home and Remodeling Expo will be next weekend on Aug. 23 and 24, at the Chattanooga Trade and Convention Center. Organizers said, "Come see the latest home products and services and landscaping for your remodeling project or new home." Some of the products to see are kitchens, appliances, countertops, flooring, siding, painting, roofing, outdoor living, pools, etc. ... (click for more)

School Board Delays Decision On Big-Ticket Health Insurance Item For 1 Week

The Hamilton County School Board on Thursday night voted to delay a vote on a new insurance plan for employees until next Thursday. Sandy Hughes, president of the Hamilton County Education Association, said, "I have a difficult time trying to think of what priority in spending is more important than the well-being of your employees and their children...You've not given us enough ... (click for more)

Man Charged In Westview Elementary Rampage Under Treatment At Moccasin Bend

The 22-year-old charged with a rampage through Westview Elementary School is under treatment at Moccasin Bend Psychiatric Hospital, officials said. Aaron Roden had been set for his first court appearance on Thursday morning. Attorney Allen Dunn of the public defender's office said the hearing needed to be delayed. A status court appearance will be Sept. 23 at 1:30 p.m. Sheriff ... (click for more)

Black Creek TIF Decision-Who Guards The Hen House? - And Response

Citizens of Chattanooga were invited to give public comment before their own Industrial Development Board Aug. 15. They arrived to find foxes guarding their hen house.  Many thought the meeting was their opportunity to seek redress in the ill-conceived Black Creek Tax Increment Financing plan. However, they learned it was a sham orchestrated by both the past and present ... (click for more)

Roy Exum: Let’s ‘Pay It Forward’

At 7 a.m. on Wednesday morning, this at a Starbucks coffee store located at 2186 Tyrone Blvd. in St. Petersburg, Fla.,  an unidentified woman who was first in line at the drive-through window, politely told the drive-through window clerk she would like to “pay it forward.” The clerk checked the next order – it was a caramel macchiato – and the first customer paid for both her ... (click for more)