Federal Housing Administration

Updated: 29 February 2024

What Does Federal Housing Administration Mean?

The Federal Housing Administration (FHA) is a federal agency that was established in 1934 to provide mortgage insurance to various qualified lenders. Issuing this insurance increases the lenders' confidence in giving mortgage loans to borrowers.

Insuranceopedia Explains Federal Housing Administration

Since mortgages can be very expensive, it can be difficult for many people to secure mortgage loans to buy a house. With FHA-backed insurance, mortgage lenders know they will not suffer a serious loss if the borrower defaults on their mortgage payments and, as a result, they can issue loans to a wider range of borrowers.

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