FHA Watch, November 2013 (Vol. 2, No. 11)

Article Highlights

  • Today, the FHA program is all about cross-subsidies; the average low-risk borrower with a $150,000 mortgage is overcharged about $9,000.

    Tweet This

  • In FY 2013 alone, nearly 200,000 home purchasers with FHA-insured loans could have saved an estimated $710 million over the life of their loans.

    Tweet This

  • In October, 14.70 percent of all FHA loans were delinquent, down from 14.97 percent in September 2013 and down from 16.57 percent in October 2012.

    Tweet This

Subscribe to AEI's financial services emails
Articles and events on the financial services sector. Published approximately once a month.

First Name:
Last Name:
Email:
Zip Code:

This Issue’s Highlight

FHA’s Predatory Insurance Practices

The Federal Housing Administration’s (FHA’s) mortgage insurance practices qualify as predatory under the definition set out by the Federal Deposit Insurance Corporation (FDIC’s) inspector general. First, FHA mortgage insurance pricing grossly overcharges hundreds of thousands of lower-risk borrowers. Second, the FHA relies on a borrower’s lack of understanding of the complicated nature of FHA insurance as well as a borrower’s expectation that the FHA would not intentionally permit borrowers to be steered into financially disadvantageous transactions. Third, cross-subsidies allow the FHA to offer abusive loan insurance terms to hundreds of thousands of high-risk borrowers.

This Month’s Features

Spotlight on FHA’s Predatory Insurance Practices
FHA’s Mortgage Insurance Practices Qualify as Predatory under the FDIC Definition

Spotlight on Best Price Execution
Minor Changes over Last Month

Spotlight on Insolvency
FHA’s Private GAAP-Estimated Net Worth Declined to Lowest Level in Seven Months

Spotlight on Delinquency
Various Rates Experience Moderate Drop from September to October

 

Also Visit
AEIdeas Blog The American Magazine
About the Author

 

Edward J.
Pinto

What's new on AEI

Holder will regret his refusal to obey the Constitution
image 'Flood Wall Street' climate protesters take aim at their corporate allies
image 3 opportunities for better US-India defense ties
image Is Nicolás Maduro Latin America's new man at the United Nations?
AEI on Facebook
Events Calendar
  • 29
    MON
  • 30
    TUE
  • 01
    WED
  • 02
    THU
  • 03
    FRI
Thursday, October 02, 2014 | 9:00 a.m. – 10:30 a.m.
Campbell Brown talks teacher tenure

We welcome you to join us as Brown shares her perspective on the role of the courts in seeking educational justice and advocating for continued reform.

Event Registration is Closed
Friday, October 03, 2014 | 12:00 p.m. – 1:00 p.m.
Harnessing the power of markets to tackle global poverty: A conversation with Jacqueline Novogratz

AEI welcomes you to this Philanthropic Freedom Project event, in which Novogratz will describe her work investing in early-stage enterprises, what she has learned at the helm of Acumen, and the role entrepreneurship can play in the fight against global poverty.

No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled today.
No events scheduled this day.
No events scheduled this day.