FHA’s MMIF Capital Reserves Continue to Climb in Fiscal 2021

Housing Finance
Contact: Curtis Milton
Director, Single Family Finance
(202) 266-8597

The Federal Housing Administration (FHA) today released its annual report to Congress that shows the agency’s capital reserve ratio of its Mutual Mortgage Insurance Fund (MMI Fund) ended the fiscal year at 8.03% — an increase of 1.93 percentage points over fiscal 2020. This is well above the congressionally mandated 2.0% capital ratio.

“This year, our Administration took unprecedented steps to deliver relief to those devastated by the pandemic. Managing the strong fiscal health and performance of the FHA program is a top priority, and I am encouraged to see the MMI Fund remain resilient through the events of the past year,” said HUD Secretary Marcia Fudge.

Key highlights from FHA’s Fiscal Year 2021 MMI Fund Annual Report:

  • As of Sept. 30, 2021, FHA had active insurance on more than 7.8 million single-family forward and reverse mortgages, with a total unpaid principal balance of more than $1.2 trillion.
  • The share of first-time home buyers using FHA insurance reached a new high of 84.7% of total FHA forward mortgage purchase endorsements in fiscal 2021. Similarly, the share of mortgages insured by FHA to minority borrowers reached almost 42% of all FHA forward mortgage insurance endorsements in fiscal 2021.
  • FHA’s forward mortgage portfolio achieved solid performance with a stand-alone capital ratio of 7.99% as of Sept. 30, an increase of 1.68 percentage points over last year.
  • The Home Equity Conversion Mortgage (HECM) reverse mortgage portfolio saw a significant improvement in its valuation with a stand-alone capital ratio of 6.08% as of Sept. 30, compared to a negative 0.78% capital ratio in 2020.

Read HUD’s press release.

For more information, contact Curtis Milton at 800-368-5242 x8597.

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