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Monday, March 4, 2013

Sens. Johnson, Crapo to Introduce FHA Reform Legislation

Senate Banking Committee Chairman Tim Johnson (D-S.D.) and panel ranking member Mike Crapo (R-Idaho) said at a hearing yesterday that they would introduce a bipartisan bill to restructure the Federal Housing Administration’s finances.

An independent actuarial report released Nov. 16 showed the agency ended fiscal year 2012 with a projected $16.3 billion insurance-fund deficit.

“I hope that ranking member Crapo and I can work together to reach a bipartisan agreement to ensure the FHA’s fiscal stability,” Johnson told hearing witnesses. “I look forward to your suggestions for ensuring the FHA’s fiscal health now and in the future.”

Crapo said he and Johnson would look at tightening underwriting requirements, increasing the minimum down payment and strengthening the FHA’s powers to force repayment of faulty loans the agency insures. “We should not kid ourselves that anyone of these … represents a quick fix,” Crapo said.

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