FDIC to put forward and vote on QRM legislation tomorrow

The FDIC will present and vote on the new proposed QRM (Qualified Residential Mortgage) legislation.  It would require 20% down on these qualified mortgage.  These mortgages would also be exempt from risk retention for issuing banks.  Other mortgages would require the initiator of the mortgage to retain 5% of the value of the mortgage on their books.

Many see the high down payment requirement in the new QRM model as hindering the recovery in housing. It will slow the purchase of homes because of the higher down payment.  This new legislation may make it more difficult to see a consistent recovery in the real estate market.

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