Record high new home loan requests to the FHA are causing strain due to the governemnt agencies lack of resouces. The FHA is short staffed and also contributing to the strain is a computing system that is two to three decades out of date.

The FHA is utilizing hardware and software that are from the 1980's and their workforce is minimal and at the workload is at capacity. Changes are not likely unless the agecy can fins a way to break away from HUD according to Brian Montgomery, who was once a commissioner for the FHA.

Mr. Montgomery states that the Management and Budget office barely gives them the amount needed to keep their computers running, but not an adequate amount to actually upgrade the old system they are forced to use.  There is not anything in the works to separate them from HUD, but if they were individualized, resources would likely be more readily available for them. The companies create 6.4 billion dollars yearly in revenue surplus.

The administration has not yet taken any action, and is delaying any such action while awaiting hearings. Elections are likely to cause even greater delays as decisions will be made depending on what happens at the November elections.

At yearly meeting of the NAREE in Austin,  TX, Mr. Montgomery indicated that he is doubtful that higher amount loan limits for the FHA will continue. He indicated that unless Congress does something, the loan limits are set to expire at the year’s end. 

/kh