Mark Zandi, Moody's Economist, Rumored as FHFA Nominee

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Byline: Kate Berry

Mark Zandi, the chief economist for Moody's Analytics, has emerged as a contender to lead the Federal Housing Finance Agency as the White House searches for a replacement for Acting Direct Ed DeMarco, according to news reports.

Zandi, a registered Democrat, worked for Sen. John McCain's 2008 presidential campaign and has testified before Congress numerous times on housing issues, leading some analysts to believe he could win over the Senate Republican caucus and be confirmed.

"We are optimistic regarding Zandi's chances during the confirmation process but caution that those expecting a substantive shift in policy at the FHFA if Zandi is nominated and confirmed will likely be disappointed," wrote Isaac Boltansky, an analyst at Compass Point Research and Trading LLC.

The possibility that Zandi was being considered to run the agency that oversees Fannie Mae and Freddie Mac was first reported by MarketWatch.

Last month, Rep. Mel Watt, D-NC, appeared to be a front-runner for the job until Sen. Bob Corker, R-Tenn., said the agency needed a politically "neutral" leader and that he could not support a possible Watt nomination.

DeMarco, meanwhile, has faced intense criticism for his refusal to endorse the use of principal reductions on Fannie Mae and Freddie Mac loans, even for a limited number of delinquent homeowners. …