Regulators Re-Propose QRM Rule
On August 28, 2013, the six financial federal regulators [HUD, Fed, FDIC, FHFA, OCC, SEC] responsible for writing and implementing the Qualified Residential Mortgage rule, or "QRM", re-proposed the rule after receiving considerable pushback from NAR, other housing industry groups, consumer groups, and lawmakers. The previous proposal required borrowers to have a 20% downpayment on the purchase of their home to qualify for the most preferred and affordable mortgage products.
The re-proposed rule sharply revises the definition of QRM and marks a victory for REALTORS(r). In the agencies re-proposal, the definition of QRM was revised to match the definition of the Qualified Mortgage, or "QM" rule announced by the CFPB earlier this year. Aligning the rules means that lenders will have to ensure that borrowers have the ability-to-repay their mortgage if the lender wants to securtize the loan under the QRM defintion.
Regulators also requested feedback on a "QRM+" alternative that would require borrowers to meet the QM standards along with a downpayment of 30%. NAR will continue to oppose any alternative with an unreasonably high downpayment that would lock qualified consumers out of the mortgage market.