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Crush of Foreclosures About to Swamp FHA

Taxpayers may foot the bill for defaulting homeowners

By Kevin Spak,  Newser Staff

Posted Feb 2, 2010 9:28 AM CST
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(Newser) – The Federal Housing Administration is staring down the barrel of a rash of foreclosures that could force it to dip into taxpayer money for the first time. The number of FHA borrowers who have missed at least three payments jumped by a third last year, to 9.1%, which means the agency is almost certain to see a lot of foreclosures soon, the Washington Post explains.

The agency’s already been through plenty of those during the crisis, leaving its cash reserves precariously low. The FHA typically covers defaults with the fees borrowers pay it, but if it runs out of cash, the federal government will automatically send it taxpayer money to cover its losses. To compensate, the agency has raised its fees, and says it’s reining in poorly performing lenders.

In this Wednesday, Aug. 29, 2007 file photo, a foreclosure sign tops a sale sign outside an existing home on the market in northwest Denver.
In this Wednesday, Aug. 29, 2007 file photo, a foreclosure sign tops a sale sign outside an existing home on the market in northwest Denver.   (AP Photo/David Zalubowski)
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COMMENTS
Showing 3 of 8 comments
Disillusioned
Feb 2, 2010 8:33 AM CST
@ WhatTha, you can stay in denial all you wish but he is the President of the USA and if you are a citizen then you also have him as President. The Home Loan crisis began under GWB as did the huge deficit the difference being GWB did not record it on the ledgers and left the debt hanging for the next President to inherit, all in all Obama took on a massive crisis but has managed it well considering the American Haters League known as the GOP who do nothing but stall and scream NO so long story short, if you renounce your citizenship then please move to a country better suited to your views such as China perhaps?
Mr_Joshua
Feb 2, 2010 6:41 AM CST
Well WhatThefu#k, you are either a renter or lucky enough to already own your own house, although I would guess by your lack of intellect that you are a renter and not one of those millions of poor souls who have lost their jobs through no fault of their own but due to a recession brought about by the former president (whom you no doubt voted for) and his lack of fiscal prudence. I would only hope that one day you lack the money to pay the rent on your trailer and can no longer drink your case of bud each day. Perhaps we will even be lucky enough that you can no longer pay your internet provider. And you can call me....Mr Joshua.
odowd80
Feb 2, 2010 6:27 AM CST
He's YOUR President too, WhatTha, like it or not.
US

 
mortgage • Federal Housing Administration • housing crisis • mortgage defaults • FHA • FHA mortgage • foreclosures

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