markg8 commented on the blog post CAP Credits FHA for Its Useful Ignorance, Allowing Mortgage Fraud to Continue
It’s my understanding that a vast majority of the bubble loans that went bad weren’t FHA loans any more than they were CRA loans. Weren’t unregulated private mortgage companies like Countrywide and Ameriquest the mortgage originators not FHA and CRA? Both had additional reporting requirements, not fewer and while the FHA may not have enforced them why would mortgage companies bother with the extra FHA cost, paperwork, and the real possibility of government lawsuits, when Wall St was saying send us more paper, we don’t care if it’s good or bad, we’ll find a home for it.
If anyone has real figures for the percentage of FHA loans gone bad over the last 10 years I’d like to see it. Otherwise I’m not buying this.