FHA Report Signals Lower Down Payments
The Federal Housing Administration’s actuarial report shows that the Mutual Mortgage Insurance Fund is an opportunity to make FHA’s low-down-payment mortgage option available to an even larger segment of borrowers.
“FHA’s actuarial report shows that the fund has indisputably found its footing,” William E. Brown, 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.”
The MMIF is responsible for paying lenders if a mortgagor defaults. 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.
In 2015, the MMIF also reached a 2 percent capital reserve ratio unseen since the Great Recession. This benchmark signals a strong rebound, a finding reinforced by the 2.3 percent capital reserve ratio FHA reported today.