The House bill (H.R. 4264) gives the Department of Housing and Urban Development and FHA more powers to police lenders and require indemnification for bad loans.
At a recent Senate Banking Committee hearing, HUD secretary Shaun Donovan signaled his support for the measure, which is designed to help the financially stressed FHA mortgage insurance fund avoid a bailout.
Sen. Pat Toomey, R-Pa., introduced the House-passed FHA reform bill in the Senate on Wednesday. FHA commissioner Carol Galante welcomed the senator’s action. This bill will “allow FHA to continue its efforts to strengthen its enforcement capabilities in order to protect its insurance fund and American taxpayers,” she said.
Senate Banking Committee chairman Tim Johnson, D-S.D., is supporting the measure, which he revealed in a letter to the chairman of the House Financial Services Committee.
“To provide the FHA with some of the powers it needs to address the current financial condition, I am urging my colleagues to pass H.R. 4264 by unanimous consent and send it to the president for his signature,” Johnson said in the Dec. 13 letter.
“I have decided that action is necessary before the Congress adjourns for the holidays,” Johnson added.