According to Bloomberg, Mark Calabria is the possible nominee and leading candidate for the post of FHFA Director. Calabria is currently VP Mike Pence’s Chief Economist. He joined the Trump administration in February 2017.
Speaking of the impact of his confirmation on GSEs, the article stated that Calabria had pushed for putting the GSEs into receivership—a process similar to bankruptcy. It pointed out that among other ideas, Calabria had previously called for the abolishment of the mortgage-interest deduction, a provision that benefited millions of homeowners.
He has also supported the elimination of government subsidies for 30-year fixed rate mortgages. However, Bloomberg sources stated that Calabria has sought to address concerns regarding his appointment among bankers and bond investors in private meetings by presenting a more tempered approach concerning Fannie and Freddie.
The publication indicated that whoever the Trump administration chooses will wield significant influence over the housing finance market—the ramifications of which will be reflected in the functioning of Fannie Mae and Freddie Mac. The new FHFA director can affect mortgage rates and compel the GSEs to lower lender fees. The size of home loans that the agencies can buy may also be restricted. This will leave room for such borrowers to get their mortgages financed through the private market.
If appointed, Calabria will replace Mel Watt, an appointee of the Obama administration. Watt’s term ends in early January, and the Trump administration has discussed installing an interim FHFA Chief while it awaits Senate approval of a permanent nominee, the people said, quoted Bloomberg.