``The Federal Housing Administration is expected to report later this week that it could exhaust its reserves because of rising mortgage delinquencies, The Wall Street Journal reported, citing people familiar with the matter. That could result in the agency needing to draw on taxpayer funding for the first time in its 78-year history, the report said. The decision won't be made until February, and Congress would not need to authorize any funding because it has "permanent and indefinite" budget authority, the report added.''

We are now about to pay the piper for damage done to FHA by rampant subprime-like abuse of its loan guarantee program (see academic reports here and here, and our consolidated info page here).

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