Pursuits
Hedge Funds Reap Gains on FHA Loans Sidelining Nonprofits
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The U.S. Federal Housing Administration started selling distressed loans in 2012 to help communities hit hard by foreclosures while also reducing losses to its taxpayer-backed insurance fund.
Two years later, the first reports on the loan sales show the program has benefited the insurance fund more than the communities, as hedge funds and private equity-backed investors drive up prices for the loans they buy with few strings attached.