February 13, 2012
The Housing and Insurance Subcommittee of the House Financial Services Committee last week passed the "FHA Emergency Fiscal Solvency Act" (no bill number yet). NAR supported the measure which strengthens FHA's financial solvency by barring unscrupulous lenders from participating in the program; allowing FHA to collect losses from lenders who made material errors in underwriting or committed fraud; and strengthens financial oversight and disclosure. The bill will also give FHA flexibility to increase premiums, if needed to restore reserve levels. NAR was successful in removing provisions from an earlier draft that would have increased the minimum downpayment requirement, eliminated the loan limit floor, and elminated the cap on premium increases. The bill will next be considered by the Full Committee later this month.