Qualified Residential Mortgage

06/17/2011 3:39 PM | Anonymous


Soon, liquidity in mortgage finance will be dictated by government regulations under the definition of a Qualified Residential Mortgage (QRM).

Dodd-Frank requires lenders to retain 5% of the risk of all mortgages that they sell to investors. The QRM is important because it exempts certain types of mortgages from Dodd-Frank's risk retention requirement. 

Regulators have gone too far and said that only mortgages with a 20% down payment will be considered a QRM. That means you can expect most lenders will be offering 80/20 LTV mortgages and few other options. 

Recently, over 200 members of Congress sent a letter to regulators asking them to reconsider QRM definition, including the negative impact a 20% down payment requirement would have on real estate markets. These lawmakers recognize that income verification, credit history and job security are more important to successful mortgage lending than a hefty down payment.

It is important that Members of Congress that have not signed the letter yet hear from you. Help stop real estate markets from getting worse! You can help by contacting your Member of Congress and asking them to sign onto this important letter to regulators 

CLICK HERE to Contact Your Member of Congress!


  • 06/17/2011 3:43 PM | Anonymous
    Comment From Skipper Henderson, Levy Abstract & Title Company

    I'm sorry, but I don't disagree that a 20% requirement for Borrowers is a bad idea. This idea that everyone has the "right" to own a home is not real. I am a strong believer that everyone, including the Banks lending the money, should have "skin" in the game. I realize this might not be popular, but I think the overall effect will be a positive one, in the long run.

    Skipper Henderson
    Levy Abstract & Title Company
    P.O. Box 148
    50 Picnic St.
    Bronson, FL 32621
    Link  •  Reply
  • 06/22/2011 12:19 AM | Anonymous
    Here's an article suggesting that most of the current (very low volume) of lending has been limited to the proposed QRM standards. 80% LTV, good credit.


    I for one, would rather see slightly looser standards and more transaction volume.
    Link  •  Reply
  • 06/22/2011 12:54 PM | Anonymous
    Looks like our efforts to contact Congress are paying off.

    A new article: More lawmakers join major push to reduce QRM down payment http://www.housingwire.com/2011/06/20/more-lawmakers-join-major-push-to-reduce-qrm-down-payment
    Link  •  Reply
  • 06/24/2011 6:20 PM | Anonymous
    WASHINGTON -(Dow Jones)- The Obama administration is "seriously considering" criticism of a proposal by bank regulators that could cause mortgage rates to rise on all but the safest home loans, a Treasury Department official is set to say Friday.

    The administration and regulators have been under fire in recent weeks from lawmakers and an alliance of housing industry lobbying groups and advocates for minorities and consumers. They argue that a proposal mandated by the Dodd-Frank financial overhaul law to overhaul the market for mortgage-backed securities will restrict credit and undermine the already weak housing market. The Dodd- Frank law aims to spur sounder lending practices by requiring banks that package mortgages and other assets into securities to have more "skin in the game." They are to meet this requirement by holding 5% of the credit risk for those loans.

    Link  •  Reply
Contact us
© 2011-2017 Florida Land Title Association

Member management site supported by Gulf2Bay Tech St. Petersburg, FL

Powered by Wild Apricot Membership Software