FHA Chief: Fix Would Add $330MM a Month to Fund

Returning to his Realtor roots, Federal Housing Administration commissioner David Stevens called on the nation's largest trade group of real estate professionals to storm Capitol Hill in support of legislation to reform the government's housing insurance agency. "The FHA is at risk," Stevens told NAR's midyear legislative meeting in Washington. The FHA chief, who came to the agency from Long & Foster Realtors, one of the largest independent real estate companies in the nation, said the government cannot continue to prop up the housing market "unless we do something to shore up" FHA's capital reserves. Currently, H.R. 5072, which would allow the FHA to more closely mirror how private sector mortgage insurers price their products and hold lenders accountable for the loans they originate, has been cleared by the House Financial Services Committee but has not yet been scheduled for floor action. Commissioner Stevens called it a "critical bill" because otherwise FHA cannot continue to be the cornerstone to the housing market it has been for the past 30 years. If the legislative changes Stevens wants are enacted, the estimated value to the FHA insurance fund would be some $330 million a month. He said the fixes would help the agency replenish its capital reserves even faster than if this authority was provided through the annual Congressional approval process.