"FHA lending last quarter may have topped the combined volume of government-supported Fannie Mae and Freddie Mac in a home-lending market thatâ??s still a â??government-financed market,â?? David Stevens, the agencyâ??s head, said today at a conference in New York, citing research by consultant Potomac Partners.
â??This is a market purely on life support, sustained by the federal government,â?? he said at the Mortgage Bankers Association conference. â??Having FHA do this much volume is a sign of a very sick system.â??
The FHA, which backs loans with down payments as low as 3.5 percent, insured $52.5 billion of home-purchase mortgages in the first quarter, compared with $46 billion of purchases of the debt by Fannie Mae and Freddie Mac, according to data compiled by Washington-based Potomac Partners.
Let's have another bubble!!!