Two differing notions have emerged during a recent hearing in the House Financial Services Subcommittee on Housing and Insurance regarding the rapidly changing relationship between private mortgage insurance and the FHA single-family mortgage insurance program. One view is that FHA’s existing policies either ignore or violate basic regulatory principles and continue to crowd out private capital. Compared to state-regulated private MIs, the FHA has far less stringent standards and enforcement from a regulatory perspective has been disappointing. Proponents of this view say that ...