The disruption in the housing and credit markets has resulted in an increase in FHA mortgage lending.  Significant increases, however, have occurred mostly this year helped by the various government initiatives to stimulate housing and prevent foreclosures. 

According to the Mortgage Bankers Association, the government-insured share of mortgage applications has tripled in the past year.  In July, 29.1% of all mortgage applications were for government-insured loans, which is primarily FHA.  This is up from 8.4% in July 2007. The MBA also noted that HUD data show that the level of conventional-to-FHA refinance applications increased by 317% on a YOY basis in July.  Most of this is likely to have been subprime ARMs. Applications for government-insured loans are also on the rise - up nearly 134% from a year ago, while conventional applications are down 50%, said the MBA.   

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