FHA Publishes Its Middle Class Promise
Biniam T. Gebre, the Acting Federal Housing Administration Commissioner and Acting Assistant Secretary for Housing, took to the FHA’s blog on Thursday to share an impassioned note about the organization’s recent decision to decrease its PMI premiums.
In a piece titled “FHA’s Middle Class Promise,” Gebre goes on to explain that it’s all good news – there is no catch – and that there is no reason to believe the lessened fees will lead to another housing market crash.
“We believe it’s time to reduce our prices to make it possible for nearly quarter of a million credit-worthy families to purchase their first home in the next three years,” he wrote. “Still, there are some who don’t want us to reduce our annual insurance premiums. These critics claim this is somehow a return to the days of subprime lending when loans were approved for borrowers who had no business buying a home and set the nation on a path to ruin. This reduction doesn’t change who qualifies for an FHA loan; it only changes the price someone pays for an FHA loan. Let me be clear – FHA has never, is not, and will never engage in the sorts of lending practices that triggered the housing crisis. Unless one is trying to make a distinction, using the words ‘subprime’ and ‘FHA’ in the same sentence is not factual. The borrowers that FHA serves are not subprime. They are in fact the prime example of families pursuing the American dream.”
Image via flickr/woodleywonderworks