Should FHA home loans be more expensive?

This could trigger a whole lot more REO's and Short Sales...

FROM CNN.com: Should FHA home loans be more expensive?

NEW YORK (CNNMoney.com) -- Should it be more expensive to get a mortgage insured by the Federal Housing Administration?

That is the question the House Financial Services Committee examined on Wednesday afternoon.

Currently, FHA loans comprise more than 30% of the entire home-loan market. But as some of those insured loans have defaulted, the FHA loan-guarantee fund has slipped below the Congressionally mandated 2% level. As a result, some lawmakers are suggesting that FHA loans need to be more expensive to obtain.

In fact, a House bill, the FHA Taxpayer Protection Act of 2009, would increase the minimum down payment required to obtain an FHA loan to 5% from 3.5%. That, sponsor Rep. Scott Garrett, R, N.J., believes, would make borrowers more committed to maintaining their mortgages.

Keep this in mind as you list REOs and List Short Sales