OfflineThe FHA, Federal Housing Administration, has become a popular destination for borrowers in the last few years. With banks and lenders tightening lending, and raising credit score and down payment requirements, the FHA has become the best hope for those who want to buy a home and need a mortgage. However, the FHA is rife with foreclosure properties and is backing a great many loans that are underwater. The agency’s reserve fund has been depleted, and some analysts believe that there isn’t a lot of room left before a taxpayer bailout might be required.
If home prices continue to drop in the coming year, losses could exceed reserves, which would require either a bailout or another increase in fees charged to borrowers. Fees have been raised in the wake of the housing and mortgage crisis, but the FHA loan is still desirable to many. Though fees are high, interest rates are low and the lower down payments are providing the only chance for many to buy.
FHA officials aren’t throwing in the towel though. They downplayed the risk of needing a bailout, pointing to forecasts from Moody’s Analytics. These forecast a rise in home prices of 1.2% in fiscal 2012. Carol Galante, FHA’s acting commissioner stated “It would take a very significant decline in home prices for the portfolio to require any additional support.”
The same report did state that there is a 50% chance that the losses on the agency’s current portfolio could exceed the current cushion. However, new loans are expected to bolster the reserve in the coming year. Reserves are expected to return to 2% under the actuaries’ baseline scenario, which calls for home prices to rise over the next three years.
Outside analysts aren’t so optimistic though. As the agency has insured hundreds of billions of new low-down-payment loans in the past three years, there is significant risk in their opinion of problems if there isn’t a sustained improvement in home prices. There is also a concern that the agency is underestimating how far underwater many of the borrowers are.
Our country is over 90 trillion dollars in debt! Not that long ago we were just hours away from defaulting on our countries debt, so what did our government do, they raised the debt ceiling.... That put the nail in the coffin, there is no way that we can pay back this kind of debt, and our government knows it!! So what does that mean for us in the very near future? Despite what our government says, or the local news, a complete crash is gonna happen. Look whats also happening on a world scale, every country is in BIG trouble, pay attention people...You cant run a country on lies, and corruption, its sad that our own government is not telling all the people what they should really be doing to prepare.
That's why they are the government. That's what they do.
People need to wake up. I think the protester of wall street is just the tip of the iceberg. I also posted about this subject last week which can be found here; http://www.deangraziosi.com/real-estate-forums/market-trends-and-conditi...
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Its very sad that our government is gonna ride this desperate situation out until the bitter end, then it will be too late.. Yes the wall street protests, and the world wide protests are just the beginning of what is gonna be the collapse of our present economic system. Im amazed at the people in our country that just DONT GET IT, and see whats really going on around them! I think that they are either to busy, or just dont want to admit to themselves the truth of the matter, and that there gonna need to make changes in there lives SOON to survive the upcoming crash. If your looking for the truth go to the sources that are telling you so. Go to The National Inflation Association, go to mej.com and scroll down to a show called mejonomics and listen to some of the past shows etc...These are just a few of the VERY truthful sites to visit..
Yes sir. I really think that everyone is too entertain with what ever they are doing and are not aware. Just spread the word to your family and friends so they won't feel the raft of it. But, yes it is very sad.
www.ronpaul2012.com
He's the only chance we have at controlling Big Gov's spending. Restore the Constitution and abolish the FED and income tax.
Sheila
"If God is for us, who can ever be against us?" Romans 8:31 NLT
Buddy Roemer for President if you want serious reform