We now know for certain that the FHA is not just broke, the FHA is bailout broke.
Washington, DC – April 10, 2013 – (RealEstateRama) — Financial Services Committee Chairman Jeb Hensarling (R-TX) today issued the following statement concerning the expectation in the President’s budget that the Federal Housing Administration (FHA) will require a nearly $1 billion taxpayer bailout this year:
“We now know for certain that the FHA is not just broke, the FHA is bailout broke. If the FHA were a private financial institution, likely somebody would be fired, somebody would be fined, or the institution would find itself in receivership. Instead, the FHA is merrily on its way to becoming the recipient of the next great taxpayer bailout. It’s outrageous.
“Since 2009, administration officials have repeatedly assured Congress and the American people that FHA was healthy and on a sustainable financial footing. The facts, however, as even the president’s own budget now confirms, prove otherwise.
“By attempting to be all things to all borrowers, the Obama administration has abandoned FHA’s historical mission, it has endangered the future operations of the agency, and it has put taxpayers at risk for another Washington bailout.
“Hardworking Americans demand a healthy economy and we cannot have a healthy economy until we have a housing finance system that is both sustainable and competitive. In its current form, FHA is clearly an impediment to such a system. Because of this, the Financial Services Committee has been working to examine needed reforms to FHA, reforms that go beyond its fiscal solvency and address structural flaws of FHA.