RJ and Makay

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The Federal Housing Administration (FHA) may require a Treasury Department cash infusion for the first time in its 78-year history, according to a budget projection report released today.  The agency, which has become a major source of financing for home purchases since the housing crisis four years ago, burned through much of its reserves this past year as defaults mounted on loan guarantees.

Middle-Income Boomers, a new study by Bankers Life and Casualty Company Center for a Secure Retirement (CSR), found that 73% of middle-income baby boomers are rethinking retirement, and that 79% are delaying their retirement by an average of five years.

The study examined 500 Americans, age 47 to 65, with incomes between $25,000 and $75,000.  One in seven respondents (14%) believe that the turbulent economy will prevent them from ever retiring.

With mortgage rates at their lowest since the end of January, mortgage applications were up last week as borrowers looked to refinance. The Mortgage Bankers Association (MBA) index of loan applications rose 13% in the week ended February 18 after dropping the prior week to its lowest point since November 2008. Meanwhile, the association's refinancing measure jumped 18% and its purchase gauge rose 5.1%.

“Refinancing is more sensitive [than purchases] to fluctuations in rates,” observes Paul Dales, a senior economist at Capital Economics Ltd. However, Dales says he expects refinancing to remain soft, with sales at historically depressed levels, for two or three years.