NAR is a strong supporter of the single- and multi-family programs administered by the Federal Housing Administration (FHA). The FHA single-family mortgage program has played an important and vital role in the mortgage marketplace. The FHA program has a public purpose obligation to provide mortgage insurance to American families who choose FHA to meet their homeownership needs. Increasing the capacity of FHA will insure it is a viable product for homebuyers and expands the pool of available safe and affordable loan products.
FHA's single family mortgage insurance program was created in 1934 to provide access to safe, affordable mortgage financing for American families. FHA does not lend money to homeowners. Instead, FHA insures qualified loans made by private lending institutions. Since 1934 FHA has made the dream of homeownership a reality for millions of American families.
During the economic recession and housing downturn, FHA has been one of the only sources of mortgage finance available, and they have weathered the storm well. While banks, lending institutions and private mortgage insurers went bankrupt or collapsed, FHA has been there. During the worst economic crisis of our time, FHA provided access to homeownership to more than 2.8 million first time homebuyers in the last four years.
Today, FHA continues to provide insurance and pay claims. For the first time in its history the program does not currently have a full 30 years' worth of expected claim payments. But as our economy continues to improve, and housing prices continue to rise, so will FHA's financial health. FHA has been the shining light in our economic crisis, and we believe they will continue to be an integral force in our recovery.
Additional Information from NAR:
- Role of FHA
- FHA and Subprime
- FHA Fund Improvements
- FHA's 203K Program Update
- NAR Survey of Mortgage Originators: QM and FHA Trends