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Never in its 70+ year history has the Federal Housing Administration been so busy in its mission of providing mortgage insurance. Today, the FHA holds the loans for 5.2 million single-family homes and more than 13,000 multi-family (attached) home projects. But is all of this activity a good thing? And can the FHA keep up with the demand created by first-time buyers in recent months?

To get some answers, The Real Story called Lisa Marquis Jackson, a Vice President at John Burns Real Estate Consulting and director of the company’s qualitative analysis services. Lisa has covered the FHA as a business journalist, and has recently been following the up tick in the number of loans in the FHA’s portfolio.

For some background, the FHA was established in the 1930’s in an attempt to increase homeownership during the Depression. As a part of HUD, the FHA offers low down payments, easy credit qualifying, eligibility to people with less than perfect credit, a loan at reasonable cost, and even money for home repairs. It’s all there on its website:  www.hud.gov/fha” www.hud.gov/fha.

What the website doesn’t tell you is that the FHA used to be responsible for the mortgage insurance on about 2 to 3 percent of the mortgages made in the United States—and now it has booked about 23 percent of all loans. An FHA-approved loan is considered a safe loan because the FHA will pay the lender if the homeowner defaults. But is it a safe investment for the government?

Lisa gives us the back story on the FHA today, and during the week, pokes at  some of the loopholes in the FHA’s business plan. Stay tuned.