Julian Castro, current mayor of San Antonio and President Barack Obama’s nominee to be the next secretary of the Dept. of Housing and Urban Development (HUD), was grilled during his Senate Banking Committee confirmation hearing about cities using eminent domain to condemn mortgages by Sen. Patrick Toomey (R-PA), according to nationalmortgagenews.com. When Sen. Toomey asked Castro point blank if he would prevent the FHA (Federal Housing Adminstration) from utilizing this method, Castro, dodging the question, replied he would consult with the committee before taking a definite stance. He said he understands the concerns of mortgage lenders, but also, as a mayor of a large city, “I can understand why communities with a whole lot of folks underwater might think of this method.” He reminded the senator this method has yet to be used although it has engendered litigation.

On other topics the atmosphere was more amenable: He supports the senators efforts to strengthen the FHA’s mortgage insurance program as well as to wind down Fannie Mae and Freddie Mac; and, as MHProNews has learned, Castro wants the FHA to support homeownership opportunities for first-time home buyers and those of modest means. He also assured Sen. Mike Crapo (R-ID), “I share with you a commitment to ensuring that the FHA has a positive capital reserve ratio. It is on the right track and it does not need another mandatory appropriation,” in reference to the $1.7 billion government bailout. ##

(Image credit: U. S. Department of Housing and Urban Development)