The FHA’s efforts at underwriting reform and reducing its footprint to give way to private capital are nothing but an illusion of reform, according to the American Enterprise Institute. Raising the annual mortgage insurance premium and the required downpayment for FHA-insured loans greater than $625,500 as well as tightening the underwriting on loans with credit scores of 620 or below would impact only a tiny percentage of FHA business, said Edward Pinto, a resident fellow at AEI. “These changes make great sound bites but clearly this is the illusion of reform,” he said. Both measures are part of FHA’s latest efforts to ...