The regulation was proposed by six government agencies; the Federal Reserve, Federal Deposit Insurance Corp., Department of Housing and Urban Development, Federal Housing Finance Agency, Office of the Comptroller of the Currency, and Securities and Exchange Commission.
Many REALTORS® and industry professionals opposed the original QRM rule, proposed in April 2011, as it would have denied millions of Americans access to low cost mortgages, regardless of their sound credit.
“The vast majority of residential mortgages originated and sold by community banks are sold to Fannie Mae and Freddie Mac,” said Camden R. Fine, president and CEO of the Independent Community Bankers of America® (ICBA). According to Fine, the recent actions “would allow many community banks to continue to provide their customers with long-term mortgages. The proposed approach would establish a clear set of rules with fewer impediments to credit availability than the original proposal, which included a 20 percent down payment requirement.”
However, the new proposal isn’t the only option on the table. “In addition to the main proposal that we support today, regulators introduced an unfavorable alternative that would require buyers to put 30 percent down to qualify for a QRM loan, a restrictive measure that dramatically favors the wealthy,” said Thomas.