Health of FHA insurance fund linked to housing recovery: HUD’s Donovan

The Department of Housing and Urban Development is taking steps to help prevent a potential bailout of the Federal Housing Administration’s Insurance fund. However, the fund’s ultimate health likely hinges on the continued recovery of the nation’s housing market. The government fund intended to protect mortgage lenders from the default of loans made through the FHA had a negative balance of $16.3 billion at the end of September. HUD Secretary Shaun Donovan discussed his agency’s efforts to bolster the fund during a recent hearing before the Senate Banking Committee. Read on for the details.