Scotsman Guide > News > February 2019 > News Story

 Enter your e-mail address and password below.


Forgot your password? New User? Register Now.

News Archives

Subscribe icon Subscribe to our weekly e-newsletter, Top News.

Calabria talks GSE reform, 30-year mortgages at Senate hearing

Mark Calabria, the Trump administration’s nominee for director of the Federal Housing Finance Agency (FHFA), isn’t feeling the love from the left side of the aisle this Valentine’s Day.

Calabria, currently the chief economist for Vice President Mike Pence, got a supportive reception from Republications during his confirmation hearing with the Senate Committee on Banking, Housing and Urban Affairs on Thursday. Democrats, on the other hand, grilled Calabria, especially about his past opposition of the traditional 30-year home mortgage.

FHFAAlthough Calabria has endorsed eliminating the 30-year mortgage in past roles — including during his tenure at the Cato Institute, a Washington, D.C.-based libertarian think tank — he indicated at Thursday's hearing that he would preserve the popular loan product.

“It is indeed possible for us to have a well-capitalized, strong system that preserves the 30-year mortgage,” he said.

“I have one myself,” he joked. “I’d like to keep it.”

Democrats, however, remained critical of Calabria’s previous remarks, saying that terminating the 30-year mortgage would be especially harmful to African-Americans.

Calabria also faced questions regarding his knowledge of administration plans to restructure housing finance. Leaked remarks last month, reportedly from acting FHFA Director Joseph Otting, included a description of Calabria “signing off” on a housing-reform plan that included privatizing Freddie Mac and Fannie Mae without gathering Congressional input. Calabria denied knowledge of such a plan and said that he left conversations about housing-finance reform within the administration once he knew he was being considered for the FHFA's top job.

Instead, he framed Otting’s words as a morale booster for FHFA personnel.

“What he referred to in the terms of me 'signing off' was my longstanding loud support for housing-finance reforms,” he said. “I believe he was conveying to the staff through a pep talk that we will move forward.”

Calabria’s prepared testimony included the assertion that, if confirmed, his role would be “to carry out the clear intent of Congress, not to impose my own vision.”

Regarding Fannie and Freddie, Calabria indicated that his goal is to ensure that the two government-sponsored enterprises were “well capitalized, well managed and well regulated.” He added that he wants to increase the minimum capital reserve the GSEs are required to maintain as a cushion to avoid another government bailout. He conceded that he and Congress might not agree with how much that amount should be, triggering questions from Sen. Mark Warner, D-Va., over the potential consequences for mortgage borrowers.

Again, he signaled willingness to work with Congress on such an amount “if we can get to a reasonable capital level that avoids the possibility of crisis.”

Sen. Elizabeth Warren, D-Mass., also expressed concern about the future of the FHFA’s affordable-housing goals under Calabria’s watch.

“Congress requires the FHFA to set affordable-housing goals. You made clear you want to gut these housing goals,” Warren said, referencing previous Calabria comments that called affordable housing’s role in the last housing crisis “beyond debate.”

Regarding those goals, Calabria went back to touting regulations and capital buffers.

“I do believe we can get to a spot where we can have risk-taking via affordable-housing goals, if we can have an appropriate regulatory structure that has capital backing those goals,” he said. “I'm very concerned about any large financial institution where we push it to take an additional risk without the appropriate regulatory structure in place.”

Calabria acknowledged the housing difficulties of middle- and low-income Americans during his prepared remarks.

“I believe we are truly at a critical juncture in housing-finance policy,” he said. “Families across America face heavy burdens making their rent or mortgage payments in many cities, towns and states, as well as the unique barriers faced in our rural and tribal communities.”

While Democratic skepticism of Calabria’s candidacy was evident during the hearing, groups within the housing industry were quick to endorse him after his testimony today.

"The National Association of Realtors was pleased to see Mark Calabria today defend the FHFA's critical role in the U.S. housing market,” NAR President John Smaby said, urging a quick confirmation. “Specifically, NAR applauds Dr. Calabria for pledging his commitment to the 30-year fixed-rate mortgage, supporting additional access to capital, and highlighting taxpayer and consumer protection as critical tenants of housing-finance reform."


Questions? Contact at (425) 984-6019 or

Get the latest news and articles from Scotsman Guide straight to your inbox.

Send me the following e-mails:

Learn more about Scotsman Guide e-mails

Thank you for signing up to receive e-mails from Scotsman Guide.

A confirmation e-mail has been sent to the address you provided.

For questions regarding your e-mail subscriptions please contact or call (800) 297-6061.

Fins A Lender Post a Loan
Residential Find a Lender Commercial Find a Lender
Follow Us:Visit Scotsman Guide Facebook pageVisit Scotsman Guide LinkedIn pageVisit Scotsman Guide Twitter page


© 2019 Scotsman Guide Media. All Rights Reserved.  Terms of Use  |  Privacy Policy