Congresswoman Maxine Waters (D, Calif.) and Rep. Michael Capuano (D-Mass.) today reintroduced legislation aimed to get the Federal Housing Administration back on track.
The FHA Emergency Fiscal Solvency Act, co-sponsored by Rep. Waters, ranking member of the House Committee on Financial Services and Rep. Capuano, ranking member of the Subcommittee on Housing and Insurance, is geared toward the agency’s long-term solvency following it falling into a dire financial position revealed by an audit of its insurance fund in 2012. The
The bill would allow for greater enforcement against loan originators who have high loan losses and who engage in faulty underwriting. It would allow FHA to require indemnification for loans written improperly.
“This legislation takes an important step towards improving the financial stability of the FHA,” Rep. Waters said. “Over 400 members of the House voted for an identical bill last Congress, which was drafted in the Financial Services Committee in a collaborative manner and on a bipartisan basis. Working with the Administration, we plan on drafting additional legislation to give FHA more tools to bolster its insurance fund. But this is an important first step, and should be considered immediately, given that it was supported on such an overwhelming, bipartisan majority in the last Congress. It is time to move beyond discussion of this issue and take action.”
The bill was previously introduced in 2012 among discussion of FHA reform measures receiving strong support from members of Congress.
“The House passed legislation reforming the Federal Housing Administration last year with the bipartisan support of 402 Members,” Rep. Capuano said. “There is clear agreement on the need to provide the FHA with additional risk management tools, increased transparency and enhanced reporting requirements. Let’s move forward now with what we agree on and work together to make additional improvements.”
Written by Elizabeth Ecker