FHA Releases 2021 Annual Report to Congress Addressing its MMI Fund

FHA recently announced the release of its 2021 Annual Report to Congress on the financial condition of its Mutual Mortgage Insurance Fund (MMI Fund).  The MMI Fund supports FHA’s single-family mortgage insurance programs, including its forward mortgage purchase and refinance transactions, as well as mortgages insured under its HECM (i.e., reverse mortgage) program.

Some of the highlights from the Fiscal Year 2021 FHA Annual Report include:

• As of September 30, 2021, FHA had active insurance on more than 7.8 million single family forward and reverse mortgages, with a total unpaid principal balance of more than $1.2 trillion.
• The MMI Fund exceeded its congressionally-mandated capital reserve ratio (Capital Ratio) minimum of 2% for the 6th year in a row.  The overall MMI Capital increased by 1.93 percentage points from 6.10% in 2020 to 8.03% in 2021. 
• The share of mortgages insured by FHA to minority borrowers accounted for more than 42% of all FHA forward mortgage insurance endorsements.
• FHA’s 2021 forward mortgage portfolio had a positive Capital Ratio of 7.99% and a positive MMI Capital of $94.89 billion (an improvement from the positive Capital Ratio of 6.31% and positive MMI Capital of $77.76 billion in 2020).
• FHA’s 2021 HECM portfolio had a positive Capital Ratio of 6.08% and a positive MMI Capital of $3.81 billion (an improvement from the negative Capital Ratio of 0.78% and negative MMI Capital of $492 million in 2020).

The 2021 Annual Report is available here.