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Is FHA the Next Bailout?

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    Wendell Goler reports from the White House

  • Duration 2:36
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Nation's housing crisis has crippled the Federal Housing Administration to such a degree.

That you may have to step in with more of your money taxpayer funds.

FHA reserves are -- -- dangerously low level and senior White House foreign affairs correspondent Wendell Goler reports.

There's a good chance things will get worse before they get better.

A new report by the Federal Housing Administration says the chance it will need a bailout next year quote he is close to 50%.

Over the past five years the FHA's market share was grown 600%.

And it's cash reserves have fallen eight -- Edward Pinto says it's over extended -- and have over a trillion dollars.

Mortgages that they guarantee.

They've got -- -- 35000 of them are seriously delinquent bad home loans fueled the meltdown at the start of the latest recession.

At a senate committee hearing today lawmakers look for hope that the housing market will stop holding back the recovery I have never seen.

The nation.

Move into an economic recovery without housing being one of the drivers and having.

A housing market is that -- on the move and thriving again.

Is going to be critical to that.

But the good severed or Fannie Mae and Freddie Mac had little hope to offer them.

Home foreclosures were up 7% last month though they were lower than a year ago and Fannie and Freddie remain on government life support.

These institutions -- the colossal failures in US history.

182.

Billion dollars now that to taxpayers have squandered on these institutions still President Obama is counting on the institutions.

The help people refinance loans that are more than their houses -- work.

Under an executive order that bypasses congress we're just gonna go ahead -- -- -- our -- meanwhile conservative -- Edward DeMarco is defending tens of millions of dollars in bonuses -- -- Fannie and -- top executives.

I am trying to encourage these people to stay and continue to mitigate losses.

He keeps -- current infrastructure of the country's housing finance system operates.

DiMarco is trying to gradually reduce Fannie and Freddie share of the market and have the private sector picked up more.

Private lenders pulled back from the market after the sub prime meltdown and the FHA -- been filling the void.

Now Pinto says it has overstayed its welcome recently the private sector has been trying to get back into the market with private capital.

And FHA has largely been standing in the way.

And FHA bailout could be tens of billions of dollars but experts say without the FHA loan guarantees home prices would have fallen even further.

And even more people would all more than their homes are worth.

-- -- -- a lot on the north --

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