Federal Housing Agency could need bailout

According to the FHA’s latest monthly outlook report, there is a jump in serious deliquencies for loans insured by the FHA, from 8.4% in August to 9.3% in November.  However the FHA already has depleted cash reserves from dealing high deliquencies since the housing bust began.  An independent audit of the FHA revealed that the losses from mortgage defaults depleted the agency’s reserve fund from 0.26% or 2.6 billion which is below the Congressional mandatory level of 2.0%.  Estimates show that the bailout could cost at least $20 billion and at most $50 billion.  If the FHA runs out of funds and there is no bailouts, low-income and first-time buyers would be without a significant source of