FHA Report Shows Fresh Opportunity to Make Homeownership More Affordable

FHA Report Shows Fresh Opportunity to Make Homeownership More Affordable

The Federal Housing Administration’s just released (link is external) actuarial report shows that the Mutual Mortgage Insurance Fund is on a steady financial trajectory, a finding the National Association of Realtors® believes is an opportunity to make FHA’s low-down-payment mortgage option available to an even broader swath of borrowers. “FHA’s actuarial report shows that the fund has indisputably found its footing,” said NAR President William E. Brown, a Realtor® from Alamo, California and founder of Investment Properties.

“That’s good news for taxpayers, and a reflection of FHA’s sound stewardship. It’s clear from this report that FHA can continue taking responsible steps to manage their risk even as they take action to make homeownership more affordable for lower- and middle-income buyers.”

FHA’s MMIF is responsible for paying lenders if a mortgagor defaults. In a sign of continuing health, the report shows that the fund’s “seriously delinquent” rate is at a ten-year low, while the overall economic value of the fund has increased by $3.8 billion.

Last year the MMIF also achieved a 2 percent capital reserve ratio for the first time since the Great Recession. This marked an important benchmark showing that the fund had strongly rebounded, a finding reinforced by the 2.3 percent capital reserve ratio FHA reported today. FHA also reported a 3.2 percent reserve ratio for the “forward” program, which encompasses FHA’s non-Home Equity Conversion Mortgage portfolio.

NAR believes that the report would have appeared even stronger if not for weaknesses in the HECM program. In light of the MMIF’s increasingly good health, NAR is encouraging FHA to reduce mortgage insurance premiums to better reflect the risk in the marketplace and fulfill its mission of serving low- and moderate-income borrowers.

According to NAR estimates, the 50-basis-point premium cut announced in January 2015 provided an annual savings of $900 for nearly 2 million FHA homeowners.

A recent Federal Reserve study (link is external) also found that the January 2015 reduction in mortgage insurance premiums had a quick and significant effect on FHA mortgage volume.

NAR also supports eliminating (link is external) “life of loan” mortgage insurance, which borrowers must continue to pay until the loan is extinguished or refinanced. Conventional mortgage products, by contrast, traditionally require mortgage insurance only until a sufficient amount of equity is achieved on the property.

“FHA mortgages are an important option for buyers, but high premiums and lifetime insurance requirements can take that option right off the table,” Brown said.

“By lowering premiums and eliminating life of loan mortgage insurance, FHA can expand on their work to serve a broad population of homebuyers. We look forward to working with them in the months ahead to bring these changes to light.”

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing over 1.1 million members involved in all aspects of the residential and commercial real estate industries.


Video of the Day


 

 
Wayne's Interior Design

Top Lawyers


Allendale Hillsdale River Vale
Alpine Hohokus Rochelle Park
Bergenfield Leonia Rockleigh 
Bogota Little Ferry Rutherford 
Carlstadt Lodi Saddle Brook 
Cliffside Park Lyndhurst Saddle River 
Closter Mahwah S. Hackensack 
Cresskill Maywood Teaneck 
Demarest Midland Park Tenafly 
Dumont Montvale Teterboro 
Elmwood Park Moonachie U. Saddle River 
E. Rutherford New Milford Waldwick 
Edgewater N. Arlington Wallington 
Emerson Northvale Washington 
Englewood Norwood Westwood 
Englewood Cliffs Oakland Woodcliff Lake 
Fair Lawn Old Tappan Wood-Ridge 
Fairview Oradell Wyckoff 
Fort Lee Palisades Park Manhattan 
Franklin Lakes Paramus Queens 
Garfield Park Ridge Brooklyn 
Glenn Rock Ramsey Bronx 
Hackensack Ridgefield Staten Island 
Harrington Park Ridgefield Park  
Hasbrouck Hts Ridgewood  
Haworth River Edge  

Real Estate Listings


Allendale Hillsdale River Vale
Alpine Hohokus Rochelle Park
Bergenfield Leonia Rockleigh 
Bogota Little Ferry Rutherford 
Carlstadt Lodi Saddle Brook 
Cliffside Park Lyndhurst Saddle River 
Closter Mahwah S. Hackensack 
Cresskill Maywood Teaneck 
Demarest Midland Park Tenafly 
Dumont Montvale Teterboro 
Elmwood Park Moonachie U. Saddle River 
E. Rutherford New Milford Waldwick 
Edgewater N. Arlington Wallington 
Emerson Northvale Washington 
Englewood Norwood Westwood 
Englewood Cliffs Oakland Woodcliff Lake 
Fair Lawn Old Tappan Wood-Ridge 
Fairview Oradell Wyckoff 
Fort Lee Palisades Park Manhattan 
Franklin Lakes Paramus Queens 
Garfield Park Ridge Brooklyn 
Glenn Rock Ramsey Bronx 
Hackensack Ridgefield Staten Island 
Harrington Park Ridgefield Park  
Hasbrouck Hts Ridgewood  
Haworth River Edge  

Local Businesses


Auto Florist Oncologist
Accountants Furniture Online Classes
Bail Bonds Funeral Services Pediatric
Banks Gaming Performing Art
Barbers Gifts Pers Trainers
Bloggers Hair Salons Pets
Books Handbags Phones
Business Health Ins. Photos
Car Insurance Home Improv Pizza
Child Care Hosting Plumbers
Chinese Food Hotels Realtors
Cleaners Internet Rehab Center
Clothing Italian Food Restaurants
Colleges Jewelry Sr. Centers
Computers Laundrymats Shoes
Contractors Lawyers Software
Cosmetics Limousines Soul Food
Credit Repair Make Money Sushi
Dentist Money Loans Spas
Doctors Mortgages Taxi
Domestic Viol Movie Theatres Travel
Electricians Nail Salons Universities
Electronics Non-Profits Watches
Endocrinologist Notary Web Design
Fitness OB/GYN Wellness

 

 

 

 

 

 

Local Restaurants


African Indonesian Singaporean
American Italian Soul Food
Caribbean Japanese Southern
Chinese Korean Spanish
Cuban Kosher Sushi
Ethiopian Malaysian Taiwanese
Filipino Mexican Thai
French Middle Eastern Turkey
German Portuguese Vegan
Greece Russian Vegetarian
Indian Seafood Vietnamese