FHA and structural defects

[CANative]

"The Federal Housing Administration, the government insurer of low down-payment loans, told Congress on Friday it needs $1.7 billion from the Treasury to pad its insurance fund. This is higher than expected, due to the fact that FHA is now insuring fewer loans. "

https://www.cnbc.com/2013/09/27/mortgage-bailout-not-over-FHA-to-draw-17-billion.html

Announced on Friday... 2013. Old news. It was a statutory requirement regarding the 2% reserves. The markets improved and the money was never used. Right wing TEA party stuff.

https://fas.org/sgp/crs/misc/R42875.pdf

 

[Econobot]

That is essentially the idea. Losses are covered by MIP until 78%. So the program has been self-funded for 80+ years at no cost to the taxpayers.

You wanna explain how a government program can be self-funded with "no cost to the taxpayers"?? The only thing that is logical with the comment is that the guy who wrote it lives in California and it sounds like something Adam Schiff would say...

 

[glenn walker]

On a so called K class construction ? Old hippy cabin I would probably not make an-issue BUT if a tree stump is located under a REAL house I am making the report MPR Subject to foundation being inspected by a licensed contractor or engineer. If the report comes back "OK" then fine , but if the foundation requires additional support or leveling then the seller is going to have to mitigate it. Many FHA buyers are first time, they have very limited reserves and one good earthquake, or additional settling due to rains etc- could end up being a major cost. In most cases the few I have encountered were able to be mitigated with just a few newer steel or concrete piers.

 

[djd09]

BankThink

FHA: 60 Years of Mission Failure

In "Recent Attacks on FHA Are Wrongheaded" (Dec. 19), John Griffith of the Center for American Progress blindly repeats the FHA’s idealized and sanitized version of its history.

This hagiography ignores 60 years of wrongheaded policies perpetuating mission failure—the selling the American dream of homeownership, but delivering despair.

In 1992 former HUD attorney and senior analyst Irving Welfeld summed up the Federal Housing Administration’s history when he wrote in his book HUD Scandals: "Mention the Department of Housing and Urban Development and the word scandal comes to mind." He is in good company. Outlined below are a few examples of reporters, authors, and commentators across the political spectrum who have pointed out how the FHA’s poorly designed underwriting policies have resulted in financing failure for working-class families and a plague of foreclosures for working-class communities.

In 1954, as documented by Welfeld, FHA was targeted by the FBI for involvement in fraudulent home improvement schemes.

In 1962 the FHA’s mounting foreclosures were noted by Time magazine when it observed "Homeowners of a new and unattractive breed are plaguing the Federal Housing Administration these days. Known as ‘the walkaways,'they are people who find themselves unable to meet their mortgage payments—and to solve the problem simply move out their belongings at night, drop their house key in the mailbox and disappear. … Because it underwrites low-cost housing for high-risk groups, the FHA’s problems are particularly acute."

https://www.americanbanker.com/opinion/FHA-60-years-of-mission-failure

 

[CANative]

Class K house I appraised in Comptche, CA

 

[CANative]

BankThink

FHA: 60 Years of Mission Failure

In "Recent Attacks on FHA Are Wrongheaded" (Dec. 19), John Griffith of the Center for American Progress blindly repeats the FHA’s idealized and sanitized version of its history.

This hagiography ignores 60 years of wrongheaded policies perpetuating mission failure—the selling the American dream of homeownership, but delivering despair.

In 1992 former HUD attorney and senior analyst Irving Welfeld summed up the Federal Housing Administration’s history when he wrote in his book HUD Scandals: "Mention the Department of Housing and Urban Development and the word scandal comes to mind." He is in good company. Outlined below are a few examples of reporters, authors, and commentators across the political spectrum who have pointed out how the FHA’s poorly designed underwriting policies have resulted in financing failure for working-class families and a plague of foreclosures for working-class communities.

In 1954, as documented by Welfeld, FHA was targeted by the FBI for involvement in fraudulent home improvement schemes.

In 1962 the FHA’s mounting foreclosures were noted by Time magazine when it observed "Homeowners of a new and unattractive breed are plaguing the Federal Housing Administration these days. Known as ‘the walkaways,'they are people who find themselves unable to meet their mortgage payments—and to solve the problem simply move out their belongings at night, drop their house key in the mailbox and disappear. … Because it underwrites low-cost housing for high-risk groups, the FHA’s problems are particularly acute."

FHA: 60 Years of Mission Failure

It is time for the FHA and its supporters to put the interest of working-class families ahead of real estate agents and other interest groups who want to expand its abusive lending practices.

www.americanbanker.com

Do some more reading. It was the bankers that caused the revolt that stirred FDR into the FHA program and set up conditions that led to redlining and 40 years of lost opportunity and well building by millions of Americans, mostly minorities.

FHA does not lend money. It's an insurance program and the premiums are paid by the borrowers.

 

[CANative]

You contribute zero to this forum dj... why don't you go away and twitter vile from your mom's bedroom?

 

[glenn walker]

That looks better than what I thought was class K construction ?

 

[djd09]

don't drink the grape juice.

i'm sorry , which part of the constitution allows the government to be "insurers".

 

[CANative]

That looks better than what I thought was class K construction ?

Class K doesn't mean crap construction. Here's a piece written by one of our local Realtors®

BillBarksdaleRealEstateJournal&Thoughts About Life

Real Estate, Willits, Bill Barksdale, Homes, Houses, Mendocino, Bill Barksdale Blog, Real Estate Blog, Real Estate Journal, Willits Weekly Real Estate

bbarksdale.com

Now that I think about, the redwood stump house was actually in a remote area of Sonoma County (near Annapolis) and I don't think Sonoma has a Class K (by that name) but they do have a similar process for the same reason.