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Housing agency chief blocks aid to struggling homeowners, say House Dems

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By Bloomberg News
Thursday, Feb. 7, 2013, 7:48 p.m.

WASHINGTON — A group of House Democrats is urging President Obama to nominate a permanent director for the Federal Housing Finance Agency to replace an acting chief they say is standing in the way of aid for struggling borrowers.

The 45 lawmakers led by Rep. Elijah Cummings of Maryland, the top Democrat on the House Oversight and Government Reform Committee, said in a letter to Obama that FHFA Acting Director Edward J. DeMarco should be removed because of his refusal to use federally owned mortgage firms Fannie Mae and Freddie Mac to provide loan modifications including principal reduction.

“Ensuring that FHFA implements congressional directives to support the most liquid, efficient, competitive and resilient housing finance markets is a matter of national urgency,” the lawmakers wrote in the letter on Thursday. “For these reasons, we strongly urge you to nominate an FHFA director who is ready to fulfill this mission and address the many challenges still facing the nation's housing finance markets.”

The letter reflects a renewed effort by Democratic lawmakers and consumer advocates to get Obama to replace DeMarco, a career civil servant who inherited the job of overseeing Fannie Mae and Freddie Mac in 2009. Senate Republicans in 2011 blocked Obama's nominee for the post, former North Carolina banking regulator Joseph Smith.

The White House has been actively seeking potential candidates for the job in recent months.

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