Housing
More on Housing
by Shahien Nasiripour
As few as 0.1 percent of mortgage modifications initiated under the Obama administration's signature foreclosure prevention program involve reductions of principal, according to a federal report released Wednesday.
Research by state regulators, academics, and by the Federal Reserve shows that principal reductions lead to more sustainable loan modifications. In other words, they're the best way to ensure that troubled borrowers don't lose their homes.
The House overwhelmingly approved a bill Thursday aimed at helping the Federal Housing Administration rebuild its capital reserves.
The bill, which passed 406 to 4, will allow the FHA to raise annual premiums on borrowers, helping to bolster its Mutual Mortgage Insurance Fund. The fund has seen loan losses deplete its capital ratio to 0.53%, well below its statutory minimum of 2%.
Higher premiums would bolster the agency's ability to draw more capital into its reserves and strengthen its diminished fund.
By Jessica Holzer
A measure to put the Federal Housing Administration on firmer financial footing sailed through the U.S. House of Representatives Thursday.
The legislation, approved on a 406-4 vote, would allow the FHA to shift some of the upfront costs it charges borrowers to the annual premium and give the agency more powers to protect itself from fraudulent or poorly underwritten loans.
By Corbett B. Daly
The U.S. House of Representatives on Thursday approved a bill to shore up the finances of the cash-strapped Federal Housing Administration while also backing a measure to raise the loan limits for FHA-backed mortgages used to develop some apartment buildings.
In a 406-4 vote, lawmakers approved legislation to strengthen the FHA's finances by giving it authority to nearly triple the annual fees it charges to borrowers, known as mortgage insurance premiums.
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