The Federal Housing Administration is expected to tap the Treasury Department for $1 billion to $1.5 billion to plug a budget shortfall, according to three people familiar with the agency's finances, reports
The FHA is expected to ask for the funds at the end of the month. If it does, it would be the first time in its 79-year history that the agency needed a bailout from the Treasury.
According to AB, the gap is due almost entirely to losses in the FHA's reverse mortgage program. Many seniors who received the loans in a lump sum were later unable to pay taxes and insurance, resulting in a wave of defaults.