Meet Alana McCargo, President of Ginnie Mae.

A PROFILE OF

Bringing Powerful Public Policy at Ginnie Mae

ALANNA MCCARGO

When I first heard that another African American person had been nominated for a critical leadership role inside the Biden’s Administration, I was like, “Biden… you are a man of your word! Kudos.”

Seriously though, I was reading a report of the first 100days of the Biden-Kamala administration. The report highlighted that “the approximately 1,500 agency appointees hired by President Biden so far… 18% identify as Black or African American,” and even though there is no percentage whatsoever of the leadership position held by African Americans, I am quite impressed by how diverse this administration is. Furthermore, during Biden’s acceptance

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speech in Philadelphia, the president acknowledged the huge support his campaign got from the Black voters echoed through, “…especially for those moments when this campaign was at its lowest—the African-American community stood up again for me. They always have my back, and I’ll have yours.”

At the time, most people could only speculate that the new administration would be heavily focused on addressing policies that affect the African Americans or Black leadership through appointments to senior-level positions or a combination of both. Well, true to his word, the Biden administration is doing everything possible to make his promises come true. Since his inauguration, we’ve seen the appointment of black people to key leadership and trying to fight key issues affecting the Black people like the pandemic, joblessness, police brutality, and so many others. So far, so good!

Recently, the administration announced the appointment of Alanna McCargo to lead the Government National Mortgage Association (Ginnie Mae) at the Department of Housing and Urban Development (HUD). Before the appointment, Alanna worked as a senior advisor housing finance at HUD.

WHO IS ALANNA?

Alanna’s Journey in policy development spans over 20 years, a career she began in housing finance. While often confused as a researcher, Alanna’s focus and drive have been primarily as a business practitioner and a focus on the policy side instead of research. She spent over a decade with Fannie Mae in various leadership roles and serving in the private sector, managing mortgage agency portfolios, and implementing borrower solutions for JP Morgan Chase. When Urban Institute was preparing to launch its new Housing Finance Policy Center about seven years ago, Alanna was working at CoreLogic at the time, a big data company with tons of housing- and property-related data assets.

The company partnered with Urban to provide foundational data through a strategic alliance that helped HFPC produce its first research pieces and launch its first annual Housing Finance Symposium. Consequently, through this partnership, Alanna worked with Urban Institute and the HFPC leadership team in its first two years from the outside as a strategic partner and then joined them officially to co-lead the center into its next phase.

Alanna was with the Institute until earlier this year when she left to join Furge’s Department as a senior advisor.

According to the White House, her career has “centered on how America’s housing finance system can equitably provide credit and capital to households and affordable housing stakeholders,” Some of the notable achievements we can see from her work at Urban

Institute include developing a body of work focused on reducing racial homeownership gaps, increasing housing affordability, and reducing barriers to accessing credit and capital.

APPOINTMENT TO GINNIE MAE

In a committee hearing to determine and examine her nomination, she told the committee that while her role in slowing home price appreciation would be limited at Ginnie Mae, she would ensure that the agency would remain a reliable backstop to investors in mortgage-backed securities. That support, in turn, ensures that borrowers in government-backed programs can capture lower interest rates on home loans.

“Far too many people do not get the opportunity to plant seeds of ownership because housing is grossly unaffordable, it’s impossible to save, or they lack resources or don’t have parents who can help them get started,” McCargo said in prepared remarks to lawmakers. “Government mortgage programs help enable homeownership opportunity.”

The leadership position at Ginnie Mae has not had a senate confirmed president since 2017. This vacancy outlasted the Trump administration, and her confirmation means the first woman to lead the agency since its creation in 1968. Most senators at the banking committee have expressed their support for Alanna. However, Sen. Pat Toomey, R-Pa., the ranking member of the Senate Banking Committee, has expressed concerns about Alanna’s involvement with implementing the Home Affordable Modification Program during the financial crisis. This is a program created to help distressed homeowners but had a higher expected default rate.

“There are businesses that can’t expand because of the lack of workforce housing,” said Sen. Jon Tester, D-Mont. “There are startups that can’t start up because of the lack of workforce housing, and then the houses that are there are really expensive because demand has driven the price way up over the last 18 months.” Responding to this, Alanna agreed that many families are indeed suffering and are “incredibly cost-burdened by the cost of their housing,” adding that, “this is an issue that if confirmed, my role in being able to affect the home price appreciation and the things that are happening is limited, but we are going to be there,” she said. “Ginnie Mae is there to support millions of families by providing capital, liquidity and making sure that new rental housing projects that are financed and new homeownership opportunities that require mortgages have the capital that they need.” McCargo, during the committee hearing, alluded to her commitment to working with the current administration to prevent avoidable foreclosures as the forbearance programs come to an end and as the country continues to heal from the pandemic.

“I believe that if confirmed, I would continue to work with Ginnie Mae and the teams in the interagency working group to ensure that those families find security and have a healthy recovery from this crisis,” she said.

One of the key areas of concern by the Committee was whether McCargo would continue with the agency’s strategic road map called Ginnie Mae 2020, which aims at modernizing its systems and improving its management of counterparty risk.

She noted, “the efforts to modernize the securitization platform are crucial,” she said. ”We need to have state-of-the-art technology that runs this business, and the counterparty risk management work that this team has put in place over the last five years, and even very recently in the last two to three years, is critical and has to be second to none.”

Alanna Brings Powerful Public Policy at Ginnie Mae Housing is one of the most fundamental needs of every citizen, and not just that; it is one of the major human rights and social justice issues. It doesn’t matter whether the person is a homeowner or a renter. Alanna encourages and brings evidence-informed policy as a powerful tool that can empower policymakers, governmental agencies, regulators, non-profits, philanthropy, and business to make the bold changes needed to meet a broad set of housing demands for the citizens of this country.

During her time at Urban Institute, in one interview,

she said, “Urban and HFPC work to put evidence and facts into each debate so decisions can be more informed and outcomes closely measured. We care deeply about doing social good. We are hyper-focused on those populations who are not necessarily the first people to think about when big policy decisions are being made. We point out where policy is flawed, put a spotlight on possible unintended consequences of public policy and regulation, and collaborate and debate issues across all parts of the housing ecosystem. Bringing new data and approaches to housing policy is what is most appealing to me, and seeing the influence of evidence-informed policymaking is the ultimate reward.”

Alanna’s Work in Black Homeownership rates One of her key areas of interest is exploring the gap in Black homeownership. Here’s what she had to say concerning this issue;

“I am from the school of thought that owning a home or property matters to the economic prospects for all people. I have seen firsthand the difference it can make in lives and the choices it can open up for people. The tangible benefits of homeownership, in the long run, is that it can create greater wealth and economic mobility for families through generations.”

Adding that “This work for me is very personal. My parents purchased their first home in a segregated neighborhood in the Bronx in 1969, a 4-unit home where we lived in one apartment, and the other units were rented for additional income. My father saved money from the rental income our property offered and would soon buy a larger home in the New York state suburbs. I believe that the seeds for my life and my opportunities were planted there, where my parents could move us into a larger home with our own rooms in a diverse community with better schools and create the best opportunities they could for me and my siblings to thrive. My mother had the means to start her own consulting business when we moved to the suburbs because they had built up housing equity and had additional rental income streams through homeownership. My parents could help me with the down payment on my first home because of the equity they had built up as homeowners. I could attend college without taking on loads of student debt because my parents were homeowners. Not achieving higher Black homeownership rates has thwarted economic mobility and stifled generations of wealth building. The persistent racial homeownership gap is leaving millions of Black families behind, and without access to a key asset and wealth-building tool that has intergenerational implications for overall financial well-being.”

With that, Alanna offers some facts that help summarize the persistent gap in homeownership and offer some valuable insights about who’s being left out in the black homeownership crisis. First, she notes that the 30-percentage gap in homeownership between African Americans and Non-Hispanic whites has actually grown wider today than in 1968. Additionally, Alanna makes a very interesting conclusion adding that supposing the black homeownership rate was the same today as, in the early 2000s, there would be 770,000 more black homeowners. Furthermore, she notes that more works need to be done to recommend that if the black homeownership rate reaches 50 percent, the country needs to add about 1.3 million black homeowner households.

Interestingly, the homeownership rate for black college graduates is lower than that for white high school dropouts. “Blacks are experiencing a massive generational retrocession, and if recent trends continue, Black people born between 1965 and 1975 (Gen X) will likely become part of the first generation since those born before 1900 to reach retirement age with more renters than

homeowners among them.”

So what can we do about the Barriers to Homeownership for African Americans? Alanna notes that there are countless barriers to homeownership for African Americans, and to address these barriers, she refers to a 5-point framework to reduce the Black Homeownership gap. This framework highlights some of the critical areas of policy and practice, which, if well implemented, could advance the field and remove barriers to homeownership access for African Americans.

“It covers homeownership challenges, including access to credit and the housing finance system, and also looks at issues with the supply of affordable housing for sale, lack of financing and capital to communities that are historically disinvested in or have lower-value homes, education, and outreach needs – especially for first-generation Black people looking to become owners – and the need for big, bold change and coordination at the local policy level. Our report on barriers to homeownership also highlights critical barriers to becoming a homeowner.”

ABOUT THE POWER IS NOW MEDIA

The Power Is Now Media is an online multimedia company founded in 2009 by Eric L. Frazier, MBA, headquartered in Riverside, California. We advocate for homeownership, wealth building, and financial literacy for low to moderate-income and minority communities. The Power Is Now Media corporate office is located at 3739 6th Street Riverside, CA 92501. Ph: 800-401-8994 Website: www.thepowerisnow.com.

Sources

https://www.mgic.com/en/blog/alanna-mccargo-qa-the-power-of-public-policyunderstanding-the-black-homeownership-gap https://www.linkedin.com/in/alannamccargo/ https://www.urban.org/author/alanna-mccargo https://nahbnow.com/2021/09/biden-nominates-alanna-mccargo-aspresident-of-ginnie-mae/ https://jointcenter.org/100-day-report-on-black-appointments-in-bidenadministration/ https://www.brookings.edu/blog/fixgov/2020/12/04/keeping-his-promisesblack-presidential-appointments-in-the-biden-administration/ https://www.banking.senate.gov/imo/media/doc/McCargo%20Testimony%20 10-7-21.pdf https://test2.ginniemae.gov/about_us/who_we_are/Pages/executive_leadership. aspx https://www.usmi.org/celebrating-black-history-month-qa-with-alanna-mccargosenior-advisor-at-hud/ http://www.aspenepic.org/alanna-mccargo/ https://nhc.org/black-leaders-in-housing-making-history-today/ https://nextmortgagenews.com/speaker/alanna-mccargo/ https://www.housingwire.com/articles/biden-nominates-alanna-mccargo-to-beginnie-mae-prez/ https://www.americanbanker.com/news/affordable-housing-advocate-movescloser-to-top-job-at-ginnie-mae