House Reforms Would Revitalize the FHA

The House Financial Services Committee on May 24 approved sweeping measures that would revitalize and reform the Federal Housing Administration's single-family mortgage insurance programs. H.R. 5121, the Expanding American Homeownership Act of 2006, includes several provisions supported by NAHB. The bill, which will be sent before the full House for further consideration, would:

• Increase the limit for FHA-insured mortgages in high-cost areas
• Grant the FHA flexibility to establish zero or reduced downpayment requirements for its single-family programs
• Allow the FHA to establish a risk-based mortgage insurance premium pricing structure
• Permit the FHA to extend the maximum loan maturity to 40 years
• Authorize FHA to insure all of its single-family loan programs under the Mutual Mortgage Insurance Fund, which would clear the way for FHA to streamline the condo project approval requirements

NAHB Executive Vice President and CEO Jerry Howard testified in support of H.R. 5121 before the House Financial Services Committee’s Housing and Community Opportunity Subcommittee in early April.

He noted that these provisions would give the FHA a greater ability to respond to the needs of borrowers and enable more working families to become home owners. To read Howard's full testimony, click here. (Document is in PDF format.)

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