He says he is concerned that the agency's finances are at risk and it may ask for a bailout
Sen. David Vitter, R-La., introduced legislation this week he says will require the Federal Housing Administration to recapitalize its insurance funds in hopes of avoiding a federal bailout. "I certainly don't want the FHA to ask Congress or the Treasury Department for a bailout, which, I'm afraid, could happen sooner rather than later," Vitter said.
View full sizeThe FHA over the past four years has tripled the amount of mortgage loans it has insured. The FHA over the past four years has tripled the amount of mortgage loans it has insured.
Critics, including Vitter, say it has put the agency's finances at risk. But FHA supporters say that had it not stepped in to help deal with the scarcity of housing financing during the recent credit crisis, the decline of the U.S. housing market would have been even worse and many more people would have lost their homes to foreclosure.
Bruce Alpert can be reached at balpert@timespicayune.com or 202.4501406. Jonathan Tilove can be reached at jtilove@timespicayune.com or 202.450.1404.