How Will Trump Change the Financial Landscape for Those Who Need Loans?

A few months ago, the Federal Housing Administration had some pretty good news to share with America. They announced that the FHA’s flagship fund had grown once again in 2016 – the fourth consecutive year in which it had done so.

So what did this mean, exactly? Well, a wealthier FHA means that the risks they face when providing mortgages for potential homeowners have decreased to some extent. So it seemed appropriate that the Department of Housing and Urban Development – or HUD – would implement cuts to the FHA’s annual mortgage premiums. And they announced such a cut earlier this month.


In comes Donald Trump, 45th President of the United States

(…that’s still a little hard to believe, right? Donald Trump, President of the United States.)


Trump’s administration have already suspended this cut. Which shouldn’t be surprising: it was announced before the Inauguration that this would happen! (If you somehow missed the Inauguration, you can read up on the events over at

The cut does make it harder for those in poor financial situations to get mortgages. It is worth remembering, however, that these cuts hadn’t actually taken place yet – and that suspension just means delay, and not necessarily a complete reversal.

Stop panicking: this is normal!

New Presidential administrations have always suspended very recent regulation changes, especially when they haven’t taken effect yet. After all, it’s the new Administration that would have to see the implementation of these changes – and if they don’t agree with it, then it makes sense that they would either prevent it or make their own changes.

The Obama Administration announced the premium cuts just days ago – and did so with no consultation with Trump’s team. The suspension shouldn’t be too much of a surprise!

Will this help the economy?

By many counts, it seems that owning a home helps people achieve financial stability that can help people – and society at large – grow their wealth. But people borrowing money that they can’t actually afford to pay back is also pretty harmful to the economy. If everyone were able to pay back the loans, it would be great – but it’s a gamble, and one with huge stakes.

The fact that few outlets seem to be highlighting is that the premium cut would save the average homeowner $500 a year. This is a good amount, sure, and especially so for those with bad credit (who make up the bulk of people who apply). But it’s not exactly an economy-saving amount.

Trump may be taking action to help those who need loans

For those who have bad credit and are in dire need of a loan, then a lot of this will certainly sound like a lot of doom and gloom. That’s fairly understandable. There’s no doubt that this news will strike worry into people who were looking forward to taking advantage of this premium cut. Does this news suggest that Trump isn’t

In fact, Trump has spoken quite highly in the past of the act of borrowing money. He’s also a big supporter of the regulation of many factors of the loan industry – which may actually make it easier for people with bad credit to get loans. The Obama Administration had taken a lot of action against these sorts of companies. While many saw this as a good thing – perhaps because they have a negative image of things such as installment loans – it has throttled the ability of those with bad credit to get out of bad financial situations. Trump may have remedying action for that. Read more about this over at

Help for those with bad credit?

Still, there’s no denying that this change makes it slightly more difficult for people with bad credit to get on the housing ladder. But there are obvious problems with making it easier for people with bad credit to get loans as big as the ones you need for mortgages. They’re less likely to be able to pay that money back – and it’s precisely that problem that leads to repossessions, foreclosures, and even more debts. Not to mention, y’know, worldwide economic crashes.

Is the change good or bad? It’s difficult to say. While many of us want better financial circumstances for those who have bad credit, these premium cuts may not have been the right way to go about it. There were risks. For now, let’s be thankful that Trump hasn’t actually increased the price of FHA mortgage premiums, the way some outlets are claiming. And it’s worth remembering that Trump isn’t exactly for higher premiums in any area – you can read more about Trump and the nationwide healthcare premium problems right here at

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