In an exclusive interview, Kimber White, serving his second term as president of the National Association of Mortgage Brokers (NAMB), called on the Federal Housing Administration (FHA) to repeal its controversial “life of loan” mortgage insurance policy, framing it as an outdated penalty on working-class homebuyers.
White, who began his second stint as president of the mortgage trade group in October, argues that the policy — which mandates that most FHA borrowers pay an annual mortgage insurance premium (MIP) for the entire term of their loan — was a byproduct of the housing crisis era that is no longer necessary.
With FHA reserves now at robust levels, NAMB contends the rule unnecessarily inflates monthly payments for low- to moderate-income borrowers and forces them to refinance into conventional plans.
“It’s penalizing borrowers,” White said. “Now the mission of President Trump is for affordability and housing, and it looks like that everyone understands we have a crisis in housing.”
The policy in question requires borrowers who put down less than 10% on an FHA loan to pay mortgage insurance premiums for the life of the loan, regardless of how much equity they build. This contrasts sharply with conventional lending standards, where private mortgage insurance is typically removed once a borrower reaches 20% equity or a 78% loan-to-value ratio.
White noted that while the policy may have been financially necessary for the FHA following the 2008 housing crash to shore up its Mutual Mortgage Insurance Fund, the agency’s financial position has since stabilized.
“The fund is flush,” White said.
NAMB is actively lobbying the Trump administration and Scott Turner, secretary of the Department of Housing and Urban Development, which oversees the FHA, to reverse the rule. White indicated the association supports a House of Representatives bill known as the Mortgage Insurance Freedom Act, which seeks to codify the removal of the premium once a borrower reaches a certain equity threshold.
White expressed optimism that the current political climate favors reform, citing recent conversations with lawmakers and administration officials dealing with housing affordability.
“We’re actually optimistic,” he said. “I think if anything with housing and consumers and affordability stands a chance of passing, it is now.”
According to White, the current state of affairs creates a perverse incentive that harms the FHA’s long-term portfolio. Borrowers who build equity often refinance out of FHA loans into conventional products solely to eliminate the MIP, stripping the FHA of valuable interest income.
The NAMB leader argues that by allowing borrowers to drop the insurance premium while keeping their FHA loan, the agency would retain more loans and stabilize its portfolio.
