FHA loans on the decline?

Federal Housing Administration-backed loans may be losing favor, as the number of FHA mortgages originating in January dropped by 10 percent from the previous month, according to National Mortgage News. A total of $26.9 billion worth of FHA single-family loans originated in January, as questions continue to mount over whether how sustainable FHA loans are. Mortgages backed by the administration have a steadily growing delinquency rate, with January seeing 9.4 percent of the loans 90 days or more past due. Critics have targeted the program in recent weeks, claiming that the 3.5 percent minimum down payment requirement allows risky buyers to make purchases beyond their means.