It seems government officials do have a plan to fix homeowners in trouble, but you would never know it since they are piecemealing the initiative together one silent step at a time.

The big news this week was President Obama’s pick of Rep. Mel Watt, D-N.C., to replace Ed DeMarco as FHFA director.

It’s no secret that Rep. Watt favors principal reductions, an issue that has often plagued DeMarco, leaving him like a deer in headlights whenever he has to explain to Congress that he does not have the regulatory authority to rubberstamp principal reductions in a manner that may not produce the desired results.

DeMarco often cited his GSE conservatorship mandate as one that ensures the protection of taxpayers while stabilizing Fannie Mae and Freddie Mac. In other words, principal reductions went beyond the scope of the duties he believed Congress ascribed to him.

But it seems members of both parties are silently trying to fix that.

If you dig deeper, while Obama was pushing for Rep. Watt to lead the FHFA, certain members of Congress showed some bipartisan cohesion in introducing a bill that would create a shared appreciation principal reduction pilot program. The bill also would empower the leader of the FHFA and other federal agencies to play a role in such an initiative.

Principal reduction is often debated, with the main argument against it being that writing down debt leads to unjust enrichment for borrowers. However, a shared appreciation program would ensure when debt is crammed down, the investor or party taking the haircut is compensated if the borrower eventually regains value and sells a property at a profit. 

HousingWire’s Christina Mylinski revealed the details of the shared appreciation bill Thursday. The legislation was introduced by two Democrats and a Republican.

But the coincidences don’t end there. Within the same seven-day period, the president pegged a principal reduction advocate as his pick to lead the FHFA and the Congressional Budget Office released a report saying principal reductions could actually save taxpayers $2.8 billion.

So if there’s a doubt about whether a housing plan is being sewn together in Washington D.C., let those doubts stop here. There is certainly a plan, albeit a silent one.