The overall capital ratio of the Mutual Mortgage Insurance Fund increased by three percentage points during the 2022 fiscal year to end at 11.11%, which is well above the statutory minimum of 2%, according to the Federal Housing Administration’s annual report to Congress released today. The fund currently has $147.7 billion in MMI capital—a $41.2 billion increase from fiscal year 2021. A stress test conducted on the MMI Fund resulted in a capital ratio of 6.31%.
“These results suggest that FHA, as a countercyclical force in the economy, has accumulated enough capital in recent times so that it need not further bolster reserves in preparation for a potential recession, as major depositories have done recently,” according to the report. “FHA is already well-positioned to manage economic headwinds that may lie ahead.”
The report also showed that the share of FHA-endorsed mortgages originating from depository institutions increased for the first time in more than a decade in fiscal year 2022. Depository institutions accounted for 10.5% of FHA endorsements this year, up from 8.9% last year and the first increase since 2010, when their share was 43%. Nondepository lenders made up 89.4% of FHA endorsement originations in 2022.
Roughly 84% of FHA’s total forward purchase mortgage endorsements—or 678,675 mortgages—were for mortgages made to first-time homebuyers in 2022, according to the report. The rate of serious delinquencies—mortgages 90 or more days past due—was 4.77%, down from more than 11% during the height of the COVID-19 pandemic.