Which organization is known for insuring bank loans used for building and repairing homes?

The Federal Housing Administration (FHA) is responsible for insuring bank loans that are used to build and repair homes. The FHA was established to encourage home ownership by providing insurance on loans made by approved lenders, thus reducing the risk to the lenders and making it easier for individuals to qualify for loans. This insurance allows borrowers to obtain financing with lower down payments and more flexible credit requirements, which supports efforts to increase access to home ownership.

In contrast, while the Department of Housing and Urban Development (HUD) oversees many housing-related matters and may help facilitate FHA programs, it is not the entity that directly provides loan insurance. The National Association of Realtors (NAR) focuses on advocacy and support for real estate professionals rather than providing loan insurance or directly facilitating home construction. The Federal Deposit Insurance Corporation (FDIC) is primarily concerned with protecting depositors in banks and does not provide loan insurance for home building or repair. Thus, the FHA is the correct choice due to its specific function in insuring loans for residential development.