FHA reports decline in insurance claims

The Federal Housing Administration (FHA) released its annual report to Congress last week on the financial status of its Mutual Mortgage Insurance (MMI) Fund -- FHA’s principal insurance account that includes all single-family and reverse mortgage activity.

FHA’s study finds that since last year, the capital reserve ratio held steady, insurance claims declined significantly, and the economic value of FHA’s single-family insurance program grew by more than $1 billion, from $3.6 billion in 2009 to $4.7 billion in 2010.

Like last year’s report to Congress, the report shows that FHA is sustaining significant losses from loans insured prior to 2009 and its capital reserve ratio remains below the congressionally mandated threshold of two percent of all insurance-in-force.

Over this past year, FHA:
  • Served more than 1.75 million households by insuring $319 billion in single-family mortgages.
  • Enabled one-third of all first-time buyers in the nation (882,000 families) to become homeowners for the first time.
  • Helped more than 450,000 families avoid foreclosure through loss mitigation actions.
  • Helped 556,000 families to refinance their mortgage at lower interest rates, saving households an average of more than $140 per month.
  • Provided access to credit for close to 40 percent of purchase mortgages, including 60 percent of all African-American and Hispanic homebuyers.
To learn more about FHA financing, click here.