What is the main function of the Federal Housing Administration (FHA)?

The main function of the Federal Housing Administration (FHA) is to provide mortgage insurance on loans made to borrowers. This insurance protects lenders against losses that may occur if a borrower defaults on their mortgage payments. By offering this insurance, the FHA facilitates more accessible financing options for homebuyers, particularly for lower-income individuals or first-time homebuyers who may not have large down payments or strong credit histories.

This mortgage insurance encourages lenders to offer loans with lower down payment requirements and more favorable terms, thereby promoting homeownership and stimulating the housing market. The FHA's role has historically been significant in expanding access to homeownership, especially during economic downturns when lending can tighten.

Other functions mentioned, such as regulating real estate agents' licenses, overseeing property appraisal processes, and enforcing housing codes and standards, fall outside the primary responsibilities of the FHA. These tasks have different regulatory bodies or agencies that focus specifically on those areas.