Re “The FHA: A home wrecker,” Opinion, Dec. 27
Edward J. Pinto, the former Fannie Mae official, fails to understand the legitimate purpose of the FHA.
Low- and moderate-income families are financially stretched. They have higher default rates and higher failure rates.
This is expected. It is the price for assisting marginal borrowers.
The benefit is to those who otherwise were excluded from the process. We all benefit when they succeed.
Pinto charges that the FHA's “house is not in order.” He calculates it has negative net worth. The same can be said of any federal agency. One man's losses are another man's investments.
Lastly, private insurance will certainly price
the higher risks with yet higher premiums and fees. This is the exact market force that the FHA is
mitigating. Viva la FHA.