Here’s why FHA’s recent move to cut insurance premiums won’t boost its market share

Earlier this month, the U.S. House of Representatives passed a bill that slashed the cost of upfront mortgage insurance for first-time homebuyers who underwent counseling before taking an FHA loan. But while the push for greater financial literacy is a worthy cause, it’s unlikely to boost FHA’s share of the mortgage market, Capital Economics said in a recent report, calling the premium cuts “too small to halt the downward trend in the FHA market share.”