Washington, D.C. — Today, the U.S. Federal Housing Administration, or FHA, released its annual report to Congress, which showed that the agency’s main insurance fund met the 2 percent minimum reserve requirement for the first time since the depths of the housing crisis. Sarah Edelman, Director of Housing Policy at the Center for American Progress, released the following statement in response to the news:
Today’s annual report shows that the Federal Housing Administration is in good health and that its Mutual Mortgage Insurance Fund continues to grow stronger. The single-family loan portion of the fund has not only performed significantly better than last year, but also slightly better than predicted by last year’s report.
FHA plays an important role in the U.S. housing market. The agency has helped more than 40 million families achieve homeownership over about 81 years, and it continues to serve as a critical source of credit for first-time homebuyers and buyers of color. By serving as a steady source of mortgage credit, FHA kept us from experiencing a more severe collapse of the housing market after the 2008 crisis. Though this intervention strained FHA’s funds, today’s report is welcome news that FHA’s insurance fund is growing stronger.
Going forward, Congress should ensure that FHA has the resources it needs to continue to build a strong program that serves America’s families. FHA should also evaluate whether changes to the insurance premium structure could benefit homeowners and the Mutual Mortgage Insurance Fund in the future. Finally, FHA should continue to monitor its distressed asset stabilization program in order to ensure that FHA, homeowners, and neighborhoods all benefit from the program.
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For more information or to speak with an expert, contact Allison Preiss at [email protected] or 202.478.6331.