New FHA head fails to assuage Republicans’ concerns about the agency

Amid concerns about the Federal Housing Administration’s financial health, Obama’s has just approved an appointee to head the agency, the Wall Street Journal reported. But his pick, Carol Galante, has not gone over well with Republicans, the Journal noted.

“I think we need people now in the administration with a sense of urgency about the need to turn things around, reduce our debt, and to avoid further bailouts,” said Republican Senator Jim DeMint of S.C. “She does not appear to have that sense of urgency.”

The Wall Street Journal reported last week that lawmakers are concerned the agency will need a bailout, a belief confirmed by both an independent audit and a University of Pennsylvania study. The FHA backs nearly $1.1 trillion in mortgages, and many analysts say the agency’s internal caluclations fail to account for the potential impact of sustained unemployment and the homebuyer’s tax credit.

Previous FHA commissioner David Stevens left to become chief executive of the Mortgage Bankers Association in March, the Journal said. In the past, Galante oversaw the FHA’s multi-family lending operations.

Republican leaders told the Journal they were concerned that the Obama administration is not doing enough overall to stabilize the U.S. mortgage market. [WSJ]