Edward DeMarco the acting head of the Federal Housing Finance Agency (FHFA) announced on July 31st that he would oppose the Obama Administration's effort to implement principal reduction for underwater homeowner's who have mortgages with government backed entities Freddie and Fannie Mae.
This move defied analysis by leading economists, the Federal Reserve, The Treasury Department and even analysis by FHFA that this measure should be implemented. The program could help more than half a million borrowers and stabilize the housing market which is key to the American economy and save the government 3.6 Billion dollars.
It is time for the president to issue a recess appointment and install a new director who understands the importance of principal reduction to homeowners and the economy.