About the Federal Housing Administration

History
Leadership

What is the Federal Housing Administration?

The Federal Housing Administration, generally known as "FHA", provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. FHA insures mortgages on single family, multifamily, manufactured homes and hospitals. It is the largest insurer of mortgages in the world; insuring over 34 million properties since its inception in 1934.

What is FHA Mortgage Insurance?

FHA mortgage insurance protects lenders against loss if the homeowner defaults on their mortgage loan. The lenders bear less risk because FHA will pay the lender if a homeowner defaults on their loan. Loans must meet certain requirements established by FHA to qualify for insurance.

Why does FHA Mortgage Insurance exist?

Unlike conventional loans, FHA-insured loans require small down payments. There is more flexibility in an FHA loan than conventional loans in calculating household income and payment ratios. The cost of the mortgage insurance is passed along to the homeowner and typically is included in the monthly payment. In most cases, the insurance cost will drop off after five years or when the remaining balance on the loan is 78 percent of the value of the property-whichever is longer.

How is FHA funded?

FHA operates entirely from self-generated income and costs the taxpayers nothing. The proceeds from the mortgage insurance paid by the homeowners are captured in an account that is used to operate the program entirely. FHA provides a huge economic stimulation to the country in the form of home and community development, which trickles down to local communities in the form of jobs, building suppliers, tax bases, schools, and other forms of revenue.

History of the Federal Housing Administration - (Top)

Congress created the Federal Housing Administration (FHA) in 1934. The FHA became a part of the Department of Housing and Urban Development's (HUD) Office of Housing in 1965.

When the FHA was created, the housing industry was flat on its back:

• Two million construction workers had lost their jobs.
• Terms were difficult to meet for homebuyers seeking mortgages.
• Mortgage loan terms were limited to 50 percent of the property's market value, with a repayment schedule spread over three to five years and ending with a balloon payment.
• America was primarily a nation of renters. Only four in 10 households owned homes.

During the 1940s, FHA programs helped finance military housing and homes for returning veterans and their families after the war.

In the 1950s, 1960s and 1970s, the FHA helped to spark the production of millions of units of privately-owned apartments for elderly, handicapped and lower income Americans. When soaring inflation and energy costs threatened the survival of thousands of private apartment buildings in the 1970s, FHA's emergency financing kept cash-strapped properties afloat.

The FHA moved in to steady falling home prices and made it possible for potential homebuyers to get the financing they needed when recession prompted private mortgage insurers to pull out of oil producing states in the 1980s.

By 2001, the nation's homeownership rate had soared to an all time high of 68.1 percent.

The FHA has insured over 34 million home mortgages and 47,205 multifamily project mortgages since 1934. FHA currently has 4.8 million insured single family mortgages and 13,000 insured multifamily projects in its portfolio.

In the more than 60 years since the FHA was created, much has changed and Americans are now arguably the best housed people in the world. FHA has helped greatly with that success.

Profile of Top Leadership - (Top)

The following are FHA's top managerial staff:

Brian D. Montgomery - Assistant Secretary for Housing - Federal Housing Commissioner

Frank L. Davis - General Deputy Assistant Secretary-Deputy Federal Housing Commissioner

Ronald Y. Spraker - Deputy Assistant Secretary for Finance and Budget

Craig T. Clemmensen - Deputy Assistant Secretary for Housing Operations

John Garvin - Acting Deputy Assistant Secretary for Multifamily Housing

Phillip Murray - Acting Deputy Assistant Secretary for Single Family Housing

Ted Toon - Deputy Assistant Secretary for Affordable Housing Preservation

Gary M. Cunningham - Deputy Assistant Secretary for Regulatory Affairs and Manufactured Housing

Roger Miller - Director for Insured Health Care Facilities

Brian D. Montgomery - (Top)

The Honorable Brian D. Montgomery Assistant Secretary For Housing - Federal Housing Commissioner

As Assistant Secretary for Housing-Federal Housing Commissioner, Brian D. Montgomery is responsible for overseeing the $400 billion Federal Housing Administration (FHA) insurance portfolio. In addition, he oversees HUD's regulatory responsibilities in the areas of the Real Estate Settlement Procedures Act (RESPA), the housing mission of Government Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac, and the manufactured housing industry.

Mr. Montgomery came to the U.S. Department of Housing and Urban Development from the Executive Office of the President, where he served as Deputy Assistant to the President and Cabinet Secretary from January 2003 until April 2005. While serving in the White House, Mr. Montgomery contributed to the policy process on a wide range of issues including the Administration's efforts to boost homeownership, increase access to affordable housing, and to reform both RESPA and the GSEs. Mr. Montgomery also served as Deputy Assistant to the President and Director of Advance from January 2001 until January 2003.

Following the Shuttle Columbia accident in February 2003, Mr. Montgomery headed up a White House working group to monitor all facets of the accident investigation. This ultimately led to the process that developed the President's vision for space exploration. For this effort, Mr. Montgomery was awarded the NASA Exceptional Service Medal in June 2004.

Since his Senate confirmation in June 2005, one of Mr. Montgomery's primary initiatives has been the creation and promotion of a bill designed to modernize FHA. The Modernization Bill, which passed the House of Representatives in July 2006, is primarily focused on increasing borrower flexibility through both policy and programmatic changes. Included among them are increased loan limits, updated down payment assistance options, and a risk-based premium structure. The goal of Mr. Montgomery's bill is to provide low and moderate-income borrowers a safe homeownership option at a fair price.

Another one of Mr. Montgomery's priorities while at HUD has been the preservation of affordable multifamily rental housing, achieved primarily through mortgage insurance as well as flexible refinancing options. During Mr. Montgomery's tenure, HUD has gone to great lengths to get legislation passed in the House of Representatives that will preserve more than 900 apartment complexes, allowing for 87,000 additional units of affordable housing.

Mr. Montgomery's time at HUD has also been marked by extensive work with Hurricane Katrina disaster victims. He chaired HUD's Hurricane Recovery and Response Center at Headquarters and helped coordinate and secure temporary and long-term housing for displaced persons.

Frank L. Davis - (Top)

General Deputy Assistant Secretary-Deputy Federal Housing Commissioner

Frank L. Davis is the General Deputy Assistant Secretary for Housing-Deputy Federal Housing Commissioner, at the U.S. Department of Housing and Urban Development. He is responsible for managing Housing's day-to-day operations. He and the Assistant Secretary for Housing set policy and oversee management of Housing's multibillion-dollar mortgage insurance operations portfolio, its financial and grants management programs and its regulatory oversight responsibilities.

Previously, Mr. Davis was Director of Departmental Operations and Coordination, and assisted the HUD Deputy Secretary in his role as Chief Operating Officer of the Department, by providing a broad range of management services, strategic planning and policy coordination. Throughout his extensive federal career, Mr. Davis has held a variety of senior executive-level positions including: Acting Regional Administrator, Director of Community Planning and Development's Field Operations, Deputy Director of Block Grants Assistance, Director of the HUD Field Reorganization Task Force, and Director of Personnel. He began his federal service career as a HUD Urban Intern in 1967.

Mr. Davis is a native of Atlantic City, New Jersey, and a graduate of Rutgers University. Mr. Davis has done post-graduate work at Howard University; and is a graduate of the Senior Managers in Government Program at Harvard University. Mr. Davis is the father of three daughters.

Ronald Y. Spraker - (Top)

Deputy Assistant Secretary for Finance and Budget

Craig T. Clemmensen - (Top)

Deputy Assistant Secretary for Housing Operations

John Garvin - (Top)

Acting Deputy Assistant Secretary for Multifamily Housing

Phillip Murray - (Top)

Gary M. Cunningham - (Top)

Deputy Assistant Secretary for Regulatory Affairs and Manufactured Housing

Gary M. Cunningham has been the Deputy Assistant Secretary for Regulatory Affairs and Manufactured Housing since April 2004. The office has responsibility for enforcement of the Real Estate Settlement Procedures Act (RESPA), the Interstate Land Sales Act, and administration of HUD's Manufactured Housing Program.

Mr. Cunningham came to HUD from the Department of Justice where he was Special Counsel to the Assistant Attorney General for the Office of Legal Policy from January 2003 through April 2004. The Office of Legal Policy plans, develops, and coordinates the implementation of major policy initiatives of high priority to the Attorney General and the Administration, and assists the Attorney General and the White House in the selection and confirmation of federal judges appointed by the President. Mr. Cunningham worked particularly on the selection and vetting of judicial nominees, and on the development and enactment of policy initiatives primarily in the area of civil justice reform, including class action and medical malpractice reform.

For much of his career, Mr. Cunningham was an attorney in private law practice in St. Louis specializing in real estate, finance, construction and corporate law. While in private practice, he was the General Counsel and chief legal advisor from 1990-1994 for the development, financing, and construction of the $300 million domed stadium and convention center in St. Louis that is now the home of the St. Louis Rams. The project was completed on time and within budget.

Mr. Cunningham was Senior Vice President and General Counsel and Vice President for Corporate Development, for the $2 billion parent company of United Van Lines, Mayflower Transit and other subsidiary companies involved in global moving, transportation, relocation, insurance and equipment leasing from 1994-2000.

From 2000 - 2002, he was Vice President and General Counsel responsible for the legal affairs related to the corporate, financing, real estate, and development and construction activities of HBE Corporation in St. Louis. HBE was a 10,000-employee national design/build construction and development company, which also owned and operated 24 Adams Mark Hotels and Resorts in 14 states.

Mr. Cunningham graduated from the University of Michigan with a B.A. in Economics in 1966, where he was the Student Body President. He received a law degree from The George Washington University in 1969. He was the Administrative Assistant to a U.S. Congressman, and in 1969, was a member of the White House staff. Mr. Cunningham served in U.S. military intelligence from 1970-1971, and was awarded a Bronze Star for service in Vietnam.

Mr. Cunningham is married to Jane Cunningham, a Missouri State Representative and Chair of the Missouri House Education Committee. The couple has two sons: Bret, who is with Dell Computer Corporation; and Scott, a junior at the University of Texas at Austin.

Ted Toon - (Top)

Deputy Assistant Secretary for Affordable Housing Preservation

Ted Toon is Deputy Assistant Secretary, and Director of the Office of Affordable Housing Preservation (OAHP). OAHP has responsibility for administration of the Mark-to-Market program, and Ted oversees all aspects of program implementation. Prior to joining HUD in February of 2001, Ted was Vice President of ACG Professionals, an Atlanta-based consulting firm specializing in financial analysis, due diligence and underwriting services to the commercial real estate industry. He holds undergraduate degrees in Business and Architecture from the University of Colorado, Boulder, and earned a Master of Real Estate from Massachusetts Institute of Technology (MIT).

Roger Miller - (Top)

Director, Office of Insured Healthcare Facilities

Roger E. Miller has been the Acting Director of Office of Insured Health Care Facilities at the Department of Housing and Urban Development since December 2004. The Office supports the affordable financing of hospital projects by reducing the cost of capital, thereby improving access to quality and cost effective healthcare.

Throughout his career, Mr. Miller has devoted his energies to improving healthcare in this country. For the past 15 years, he has helped hospitals that come to the Federal government for mortgage insurance, which in turn allows them to get lower interest rates on loans for modernization. If hospitals pay less in interest, patients pay less for care. His empathy for the needs of hospitals and patients comes from over 20 years experience in hospital administration.

As the Chief Operating Officer of a large teaching hospital, the patient care costs and lengths of stay were among the lowest in the United States. Some of that time he represented and addressed the needs of physician staff, which in time led him to found a physician consulting practice.

Mr. Miller originated one of the nation's first cogeneration systems during a time of oil shortage to make the hospital less dependent on costly foreign oil and to reduce the costs of electricity and heat. Concerned about making affordable health insurance available to more people, he also helped found a Preferred Provider insurance company. Troubled about the unmet healthcare needs of minorities in the community, Mr. Miller worked to establish a system of community health centers and served as its Board Chairman. He also participated in launching an assisted living facility in Staten Island, New York, and continued as a board member. Mr. Miller has chaired committees in the Pennsylvania Hospital Association on comparative hospital performance data and on continuing education. As a lecturer in China, he addressed health care and management issues. He has spoken on cost-cutting strategies at health care forums on the regional and national levels and has served on the adjunct faculty for York College.

Mr. Miller began his focus on health care in the military's Medical Service Corps, which he joined following graduation from Dickinson College. Following Army service, he prepared himself for his life's work by getting a Masters in Hospital Administration from the University of Minnesota. He is a Fellow in the American College of Healthcare Executives. Mr. Miller and his wife Ellen have one adult son.