Watt set to get housing regulator nod while in South Africa

Democratic Rep. Mel Watt (N.C.) is expected to win Senate confirmation for a top housing regulator slot on Tuesday and he won't even be in the country to see it. 

Watt, who appears set to lead the Federal Housing Finance Agency, is headed to South Africa as part of a congressional delegation attending Nelson Mandela's funeral with members of the Congressional Black Caucus. 

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Obama, who has pressed for Watt's confirmation to head up the agency that oversees Fannie Mae and Freddie Mac, also will attend the Mandela service. 

Under new Senate rules, Watt only needs a simple majority to gain approval for his nomination, which was turned back at the end of October when he didn't get the 60 votes needed to move forward. 

It is expected that once confirmed, Watt will be sworn in by Obama for his five-year term after their dash down and back to South Africa, probably Wednesday or Thursday, according to one source. 

He will jump right into the seat that has been occupied by acting director Edward DeMarco, who has held the job since August 2009.

DeMarco is expected to stay on and help Watt with the transition as needed. 

Watt's expected confirmation is timely. 

Congress is moving more swiftly toward an agreeable plan that would wind down Fannie and Freddie and spur more private investment in the mortgage finance system, which is dominated by the federal government. 

The Senate Banking Committee is holding more hearings this week on housing finance reform with the aim of introducing a bipartisan bill soon in committee that can gain enough support to get through the upper chamber. 

Housing industry stakeholders expect Congress to produce compromise legislation by the spring, giving Watt a few months to get his shop ready of the massive overhaul of Fannie and Freddie and make some short-term fixes that have been pushed by the mortgage industry and would to give lenders better certainty in the months ahead. 

David Stevens, head of the Mortgage Bankers Association, said Watt will need to act quickly to get his team in place to take the short-term steps in preparation for the massive transition. 

As former head of the Federal Housing Administration, Stevens knows what Watt is about to experience and suggested that he take an aggressive tack in his new job because the regulatory world moves much faster than the plodding nature of Congress. 

He said Watt should be prepared to get flack from all sides with about the decisions he makes.

But installing an experienced team should help provide a solid foundation going forward.

"This is a great opportunity for him to provide clarity and put some of key elements in place now before legislation happens to help the transition occur," he said.

"We have very consistently advocated for permanent director because we fully expect that a full GSE reform plan is likely to be flushed out while he's in that job."