AgentMarkets & Economy

Story of the year? FHA to the rescue

Agency steps up in chaotic market

Learn the New Luxury Playbook at Luxury Connect | October 18-19 at the Beverly Hills Hotel

Every time the U.S. Department of Housing and Urban Development makes a change or looks at its financial stability, you hear howls about its function in housing. Should the government really be involved in homes and loans? Some members of Congress would like to see the Federal Housing Administration agency taken out of HUD and put into the private sector. For years, "government housing" options -- specifically FHA-insured loans -- were perceived as being problematic and heavily wrapped in red tape. The favorite line for real estate salespersons became, "Of course your FHA loan is screwed up ... can you spell HUD backwards?'' But, guess what? HUD also steps up. HUD tried programs that the private sector wasn't quite ready to digest. The agency first introduced and stood by the country's most popular reverse-mortgage product and also a couple of its first cousins -- low-downpayment first mortgages and the purchase-rehabilitation package known as the FHA 203K l...