FHA Eyes Risk-Based Premiums to Regain Share.(Federal Housing Administration)

WASHINGTON -- Government is famous for moving at a glacial speed. But not the "New FHA."

Though the first major congressional overhaul of the Federal Housing Administration's mortgage insurance program in a decade has a long way to go in a short time, the agency is already thinking about how to implement the proposed changes, officials said last week at the Mortgage Bankers Association's Government Housing Finance Conference here.

If lawmakers should allow the FHA to switch to risk-based pricing, as proposed in a House bill that is awaiting floor action, the agency would like to create a "little premium calculator" as a simple means of determining what FHA would charge to insure a particular loan, according to Meg Burns, director of FHA's Office of Single-Family Program Development.

The agency also plans to move condominiums into the standard 203(b) program to eliminate the "long, drawn-out" approval process, and to either completely revamp the Title I home improvement loan program or drop it altogether, Ms. Burns told the meeting.

But the question remains whether both the House and Senate, which has yet to hold hearings, can come to an agreement before members end what is expected to be an election-shortened session and go home.

While the MBA has pointed out repeatedly that the clock is ticking, FHA commissioner Brian Montgomery remains optimistic. "We have a real shot at modernization," he told the conference.

Mr. Montgomery said he was "encouraged" and "truly surprised" by bipartisan support in the House, where 61 members have signed on to the bill, which has been cleared by the House Finance Committee. And he said he is "seeing growing enthusiasm in the Senate," which he hopes will hold hearings this month.