Mr. JOHNSON of South Dakota. Mr. President, today I wish to encourage my colleagues to pass the FHA, Emergency Fiscal Solvency Act, H.R. 4264.
Since 1934, the FHA has been helping stabilize the mortgage market by ensuring that qualified low-to-moderate income and first-time home buyers have access to mortgage credit. Since the beginning of the financial crisis, the FHA increased its market share from below 5 percent in 2006 to approximately 30 percent at its peak volume in 2009 in pursuit of that mission. This counter-cyclical expansion was essential to the mortgage market--especially for first-time homebuyers who comprised 78 percent of the single-family purchase loans insured by the FHA in 2011. According to Mark Zandi, Chief Economist at Moody's Analytics, without the FHA's counter-cyclical support, and I quote, ``the housing market would have cratered, taking the economy with it.''
However, the FHA is now facing a potential crisis of its own--but this time we have the opportunity to act. On December 6, I held a hearing in the Banking Committee entitled Oversight of FHA: Examining HUD's Response to Fiscal Challenges. Through the course of the hearing, HUD Secretary Shaun Donovan described how loans made from 2000 to 2009--and especially those loans made at the height of the mortgage crisis from 2007-2009 before the ban on seller-funded downpayments took effect--were weighing heavily on the FHA's finances. As I stated in the hearing, I am very concerned about the FHA's condition and will not hesitate to take action to prevent the FHA from needing taxpayer support.
This is only an immediate first step. I fully intend to engage my colleagues on and off the Banking Committee to find bipartisan consensus to provide the FHA with the additional authorities Secretary Donovan described during our hearing and address any technical fixes to this language. While this bill is not perfect and the path forward will not be easy, it is essential that we come together to protect taxpayers and this essential program.
I yield the floor.