BOSTON – Attorney General Martha Coakley and New York Attorney General Eric Schneiderman have called for a new permanent leader to replace Edward DeMarco as director of the Federal Housing Finance Agency.
Joined in a letter by seven other state attorneys general, Coakley and Schneiderman called Fannie Mae and Freddie Mac a “direct impediment to our economic recovery” by the continued refusal to give principal relief for struggling homeowners.
The attorneys general said that principal markdowns are a central component of a 2011, 49-state foreclosure settlement, where five large banks pledged to write off $10 billion in outstanding principal. The principal markdowns would continue to bring meaningful relief to distressed borrowers, spurring our nation’s economic recovery, they said.
However, the agency has taken the position that principal forgiveness conflicts with its goal of asset preservation. That view is “not supported by reality,” the attorneys general said in the letter.
“Our nation’s economy will never fully recover until we address this foreclosure crisis,” Coakley said in a news release. “Fannie Mae and Freddie Mac have been an obstacle to progress for far too long.” •