With a nine-state coalition, state Attorney General Eric Schneiderman is calling for new leadership at the Federal Housing and Finance Agency, which oversees the government-sponsored mortgage institutions Fannie Mae and Freddie Mac.
Schneiderman, a Democrat, is joining Massachusetts Attorney General Martha Coakley in leading the charge against the agency’s acting director, Edward DeMarco.
Under DeMarco, Fannie Mae and Freddie Mac have been a “direct impediment to our economic recovery” by refusing to give principal relief to struggling homeowners, Schneiderman and Coakley wrote in a letter to President Barack Obama and Congressional leaders.
Principal reduction is a form of loan forgiveness that would help “underwater” borrowers whose mortgages are worth more than their homes.
“The FHFA’s refusal to allow for principal write-downs that would result in more loan modifications … stands in way of our efforts to provide much needed assistance to homeowners in New York and across the country,” Schneiderman said in a statement Monday.
He said “the time has come” for Obama and Congress to replace DeMarco with a permanent leader for the agency. DeMarco was appointed by former President George W. Bush.
Read the letter here:
FHFA Joint AG Letter by cara12345
Photo: Ed DeMarco (AP)
