In a hearing before the House of Representatives Financial Services Committee this week, The Honorable Brian Montgomery, Commissioner of the Federal Housing Administration (FHA) gave an update on the FHA in 2019, with a focus on how the Administration is improving its ability to promote access to homeownership, particularly for underserved borrowers.
In his statement, Montgomery discussed HUD’s Housing Finance Reform Plan, which proposes a number of recommendations to reduce risks to the MMI Fund, protect taxpayers, and also ensure that FHA maintains its focus on providing access to mortgage financing to low-and moderate-income families who are not served by traditional underwriting.
According to Montgomery, in 2019. FHA insured forward mortgages for 990,000 households, of which 616,000 went to first-time homebuyers. Additionally, FHA insured 31,000 Home Equity Conversion Mortgages (HECM).
As of September 30, 2019, FHA had active insurance on more than 8.1 million forward mortgages totaling more than $1.2 trillion in UPB, and HECMs totaling $64.2 billion in outstanding balance, Montgomery notes.
Montgomery also discussed natural disasters in 2019, and how the FHA is adapting to keep homeowners in their homes following disasters. The FHA will be making the Disaster Standalone Partial Claim” a standard mortgage relief option available for all survivors of major disaster.
Montgomery states that this option permits many homeowners to resume making payments without modifying their loan or re-amortizing the loan term, avoiding both the foreclosure process and payment increases. It also streamlines income documentation and other requirements to expedite relief.
“We are optimistic about the future of FHA and, while we not celebrating yet, FHA’s future is looking much brighter,” Montgomery stated. “However, I cannot overstate that there is a lot of hard work remaining. I look forward to working with Congress to address these challenges and ensure that FHA continues to effectively serve its customers and fulfills its fiduciary duty to taxpayers.”
Watch the complete hearing here.