HUD Deputy Secretary Brian Montgomery noted in an interview this week with The Hill that, although the deadlines for the eviction and forbearance moratoriums are quickly approaching, his team at the Federal Housing Administration (FHA) has been working hard to ensure that it is well equipped to support home owners and renters in need.
“We do have to address these deadlines that are coming up, and we’re working hard on those,” he stated. “Expect some announcements soon.”
FHA is confident in its ability to support the hundreds of thousands of FHA borrowers who are currently in forbearance because of its current financial standing and plans to work with borrowers in need of assistance.
“We’re in a good position to deal with those borrowers as they get back on their feet with what we call a ‘partial claim,'” he explained. “That is where we accelerate the arrearages and put them as a soft second mortgage that isn’t due until the borrower refinances or sells the home.”
“The same holds true on our multifamily and subsidized portfolio,” he added. “I think we’re well positioned to help the persons living in FHA-backed properties, multifamily or even public housing or project-based rental assistance.”
Montgomery spoke to The Hill as part of NAHB’s “Building the Dream” series, focusing on addressing the housing affordability crisis. This has been a longstanding issue, he noted, which has manifested itself in a number of ways, including homelessness in high-cost areas such as Los Angeles.
“Depending on where you live in the country could depend on the type of home you can afford,” he shared. “This is something that FHA tries to address through our loan limits, which vary by county.”
FHA recently released its 2021 loan limits, which increased to $822,375 in high-cost areas and $356,362 in low-cost areas — “the highest they’ve even been,” Montgomery added.
“We want to make sure that we are there to help first-time home buyers,” he noted. “But, we need to continue to work with local governments, the states, to help address some of the environmental set-asides, some of the zoning requirements — things that have driven up the cost of housing, in particular in California and other high-cost states where there’s a dramatic shortage of inventory.”
Montgomery’s full interview, including snippets from the Building the Dream: The Housing Affordability Agenda virtual townhall in November 2020, is available above.