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WBK Industry News - Federal Regulatory Developments

FHA Releases 2019 Annual Report to Congress Addressing its MMI Fund

FHA recently announced the release of its 2019 Annual Report to Congress on the financial condition of its Mutual Mortgage Insurance Fund (MMI Fund).  The MMI Fund supports FHA’s single-family mortgage insurance programs, including its forward mortgage purchase and refinance transactions, as well as mortgages insured under its HECM (i.e., reverse mortgage) program.

Some of the highlights from the Annual Report regarding Fiscal Year 2019 include:

  • As of September 30, 2019, FHA had active insurance on more than 8.1 million forward mortgages totaling more than $1.2 trillion in unpaid principal balance, and HECMs totaling $64.2 billion in outstanding balance.
  • The overall MMI Capital (i.e., economic net worth) was $62.38 billion, an increase of over $27.52 billion from 2018.
  • The MMI Fund exceeded its congressionally-mandated capital reserve ratio (Capital Ratio) minimum of 2% for the fifth year in a row.  The overall Capital Ratio was 4.84%, the highest level since 2007.
  • FHA’s 2019 forward mortgage portfolio had a positive Capital Ratio of 5.44% and a positive MMI Capital of $66.6 billion (an improvement from the positive Capital Ratio of 3.93% and positive MMI Capital of $46.81 billion in 2018).
  • FHA’s 2019 HECM portfolio had a negative Capital Ratio of 9.22% and a negative MMI Capital of $5.92 billion (an improvement from the negative Capital Ratio of 18.83% and negative MMI Capital of $13.63 billion in 2018).

The 2019 Annual Report is available here.