The Congressional Budget Office has put forth a white paper with several options to minimize taxpayer risk in the FHA program. Although FHA delinquencies are at historical lows, the CBO would like less government exposure to FHA risk, fearing that the growing popularity of private sector programs will leave the government stuck with bad loans. CBO estimates that “the share of FHA-insured mortgages going to such borrowers is likely to keep shrinking as credit standards in the private market continue to ease. That change would leave FHA with a riskier pool of borrowers, creating risk-management challenges similar to the ones that contributed to the agency’s high levels of insurance claims and losses during the recession.” According to Inside Mortgage Finance’s database, FHA lending accounted for approximately $70.6 billion, or 15.4 percent, of all first-lien lending in the second quarter. CBO’s white ...