The policy allowed FHA to front payments on behalf of distressed borrowers, but critics now argue that it’s propping up unsustainable loans and delaying the return of needed housing inventory to the market.
Read more: MBA urges FHA to tweak “complex” payment supplement partial claim rule
Of the 52,531 FHA loans that went seriously delinquent in 2024, only nine resulted in foreclosure, an editorial published earlier this year in The Wall Street Journal claimed. The piece called the program a “subprime housing bubble” waiting to burst and warned it was putting taxpayers at risk.
Although the national mortgage delinquency rate remains far below levels seen during the Great Recession, it rose to 3.53% in February, according to data from Intercontinental Exchange (ICE). At the same time, ATTOM Data reported that one in every 1,515 US housing units received a foreclosure filing in Q1 2025.
Delinquencies and defaults are concentrated in specific regions. Washington, Idaho, Alaska, Oregon, and Colorado had the highest shares of current loans in March, while Louisiana, Mississippi, Indiana, West Virginia, and Alabama ranked lowest.