HUD Secretary comments on House passage of the FHA Reform Act of 2010
"We are pleased that the House Financial Services Committee passed the FHA Reform Act of 2010 today. The bill enables the Federal Housing Administration (FHA) to reform its current mortgage insurance premium structure by shifting some of the upfront cost to the annual premium--a move that will increase FHA's capital reserves and reduce risks to the FHA insurance fund while cushioning the impact on the consumer. It also enables FHA to hold all lenders accountable to the same standards for loans they originate or underwrite and holds them responsible if they make material errors in applying FHA guidelines in the origination or underwriting of an FHA insured loan. Further, the bill provides that a lender's improper or imprudent activity at the regional level may now yield enforcement actions that restrict their activities nationwide." "The FHA is playing a vital role in the current housing market. We must therefore remain vigilant in making sure that our reserves are strengthened and that our lenders meet the highest standards of conduct. This legislation puts FHA on firmer footing to achieve its dual mission of helping to stabilize the housing market during tough times and providing affordable homeownership options to underserved American families while protecting the American taxpayer by bolstering the strength of the fund." "I am grateful to the members of Congress who worked diligently on this bill - specifically, Committee Chair Barney Frank, Ranking Member Spencer Bachus, Housing and Community Opportunity Subcommittee Chair Maxine Waters and Ranking Member Shelley Moore Capito."