The Federal Housing Administration was established by which act?

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Multiple Choice

The Federal Housing Administration was established by which act?

The main concept here is identifying which act established the Federal Housing Administration. The Federal Housing Administration was created by the National Housing Act of 1934 as part of the New Deal reforms to address the housing crisis during the Great Depression. This act set up the FHA to insure mortgage loans, encourage long-term financing, and promote safer, more affordable homeownership by reducing lenders’ risk. The other options don’t fit this specific origin: the Home Owners' Loan Corporation was created earlier, in 1933, to refinance troubled mortgages and prevent foreclosures; the Federal Home Loan Bank System was established by the Federal Home Loan Bank Act of 1932 to support savings and loan lending; and Herbert Hoover was the president before this, not the author of the act establishing the FHA.

The main concept here is identifying which act established the Federal Housing Administration. The Federal Housing Administration was created by the National Housing Act of 1934 as part of the New Deal reforms to address the housing crisis during the Great Depression. This act set up the FHA to insure mortgage loans, encourage long-term financing, and promote safer, more affordable homeownership by reducing lenders’ risk. The other options don’t fit this specific origin: the Home Owners' Loan Corporation was created earlier, in 1933, to refinance troubled mortgages and prevent foreclosures; the Federal Home Loan Bank System was established by the Federal Home Loan Bank Act of 1932 to support savings and loan lending; and Herbert Hoover was the president before this, not the author of the act establishing the FHA.

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