FHA Watch, March 2012

Article Highlights

  • FHA is still firmly in the red, with net worth of -$13.45 billion.

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  • Ginnie/USDA may be the next crisis in the "Government Mortgage Complex."

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  • USDA Guaranteed Rural Housing Loan Program's default rate exceeds the FHA’s

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Read Issue 2, February 2012.
Read Issue 1, January 2012.

The Big Picture

FHA Watch, No. 3, March 2012

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The Federal Housing Administration (FHA) — along with the entire “Government Mortgage Complex” (Fannie Mae, Freddie Mac, Ginnie/USDA, Ginnie/FHA, and Ginnie/VA) of government-owned mortgage lenders — remains in deep trouble. Though its capital position improved slightly over last month, the FHA is still firmly in the red, with a current net worth of –$13.45 billion. Particularly alarming is the growth of the Ginnie/USDA division, which has a higher default rate than the FHA.

This Month’s Features

Spotlight on Insolvency
FHA Is Estimated to Have a Current Net Worth of –$13.45 Billion and an Estimated Capital Shortfall of $32–51 Billion

Spotlight on Delinquency
Total Delinquency Rate in February Declines to 16.47 Percent; Serious Delinquency Rate Eases to 9.73 Percent

Spotlight on Ginnie/USDA
Meet the FHA’s Country Cousin, the USDA Guaranteed Rural Housing Loan Program: Its Default Rate Exceeds the FHA’s

Spotlight on Best Price Execution
A Clean Sweep by the Ginnie/USDA and Ginnie/FHA Divisions

Spotlight on the Road to FHA Program Reform
Principles to Guide FHA Reform to Achieve Sustainable Homeownership Consistent with the FHA’s Low- and Moderate-Income Mission

Spotlight on the Road to FHA Fiscal Reform
Policy Changes Needed to Implement Reform Principle 2

The Road Map to FHA Reform
Specific Steps to Reform and the Status of Each

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