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Mortgage Bankers Association Responds to Risk Retention Proposal
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Mortgage Bankers Association Responds to Risk Retention Proposal
The Easy Way to Shop For a Mortgage Loan
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Mortgage Bankers Association Responds to Risk Retention Proposal
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March 30, 2011 (Jeff Alan)
mortgage-book-image
Shortly after the release of the proposed risk retention proposal by the various federal agencies, the Mortgage Bankers Association (MBA) released a statement expressing their concerns about the proposal. Although pleased with some of the proposals, calling proposed rules for commercial real estate financing as “workable,” the MBA expressed concerns about the new rules proposed for Qualified Residential Mortgages (QRM).

The response was authored by John A. Courson, President and CEO of the Mortgage Bankers Association. His response to the proposed QRM rules was:

“Related to risk retention for residential mortgages and the qualified residential mortgage (QRM) exemption, we do have concerns about the rigid and highly prescriptive nature of the proposed rule. We believe that such a narrow construct of the risk retention exemption would limit mortgage opportunities for qualified borrowers more than it would reduce the number of problem loans. Further, if the QRM were to be enacted as proposed, it could dramatically limit the role of independent mortgage banks and community lenders, who either don’t have the balance sheet capacity to hold loans or the capital to hold in reserve as retained risk, but have long histories of originating safe and well-underwritten mortgages.”

“While factors like downpayment, debt to income (DTI) ratio and past payment history can be accurate predictors of loan performance, we do not believe that each ought to be considered independently.”

“Rather, the rule should allow for consideration of a borrowers entire credit profile before determining whether risk retention is necessary on a given loan. For example, we believe that a lower downpayment loan could be less risky if a borrower has a strong history of making payments on time and if the borrower’s debt to income ratio is on the lower end of the scale. The rule should provide more flexibility in this regard.”

“While we believe that the exemption for loans sold to Fannie Mae and Freddie Mac while they remain in conservatorship will help provide liquidity during the current period of market instability, we do note that such an exemption does little to shrink the government’s footprint in the housing finance system and could slow the return of the private secondary mortgage market.”

You can read the full response on the Mortgage Bankers Associations website.

Tags: MBA, risk retention, QRM, residential mortgages, mortgage banks, down payments, debt-to-income, payment history, borrowers, credit profiles

Source:
Mortgagexplain.com (Image)

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March 30, 2011 (Jeff Alan)
mortgage-book-image
Shortly after the release of the proposed risk retention proposal by the various federal agencies, the Mortgage Bankers Association (MBA) released a statement expressing their concerns about the proposal. Although pleased with some of the proposals, calling proposed rules for commercial real estate financing as “workable,” the MBA expressed concerns about the new rules proposed for Qualified Residential Mortgages (QRM).

The response was authored by John A. Courson, President and CEO of the Mortgage Bankers Association. His response to the proposed QRM rules was:

“Related to risk retention for residential mortgages and the qualified residential mortgage (QRM) exemption, we do have concerns about the rigid and highly prescriptive nature of the proposed rule. We believe that such a narrow construct of the risk retention exemption would limit mortgage opportunities for qualified borrowers more than it would reduce the number of problem loans. Further, if the QRM were to be enacted as proposed, it could dramatically limit the role of independent mortgage banks and community lenders, who either don’t have the balance sheet capacity to hold loans or the capital to hold in reserve as retained risk, but have long histories of originating safe and well-underwritten mortgages.”

“While factors like downpayment, debt to income (DTI) ratio and past payment history can be accurate predictors of loan performance, we do not believe that each ought to be considered independently.”

“Rather, the rule should allow for consideration of a borrowers entire credit profile before determining whether risk retention is necessary on a given loan. For example, we believe that a lower downpayment loan could be less risky if a borrower has a strong history of making payments on time and if the borrower’s debt to income ratio is on the lower end of the scale. The rule should provide more flexibility in this regard.”

“While we believe that the exemption for loans sold to Fannie Mae and Freddie Mac while they remain in conservatorship will help provide liquidity during the current period of market instability, we do note that such an exemption does little to shrink the government’s footprint in the housing finance system and could slow the return of the private secondary mortgage market.”

You can read the full response on the Mortgage Bankers Associations website.

Tags: MBA, risk retention, QRM, residential mortgages, mortgage banks, down payments, debt-to-income, payment history, borrowers, credit profiles

Source:
Mortgagexplain.com (Image)

FILL OUT THE FORM
It all starts here. Select the loan product you want to apply for and complete the subsequent questionnaire.
WE VERIFY & TRANSMIT TO LENDERS
Once we receive your completed questionnaire we verify a couple vital pieces of information and direct your information to our network of lenders, all within minutes.
REVIEW YOUR OFFERS
With offers in hand you can now compare rates and costs and get the best possible deal. Comparison shopping made easy. You fill out one form and lenders compete for your business.
CHOOSE YOUR LENDER
Congratulations! With the great learning tools we provide for you at LoanRateUpdate and the offers you have received, you've found the right product and the best rate.
HOW
MORTGAGELOANRATEUPDATE
WORKS
Whether you're looking to refinance your current loan, purchasing a new home or looking for a home equity loan, we make it easy at MortgageLoanRateUpdate. Our questionnaire is simple and quick to use and your information is safely transmitted to us with SSL encryption. With just two minutes of your time, you could have multiple lenders competing for your business which could save you thousands.
ADVANTAGES OF USING
MORTGAGELOANRATEUPDATE
FAST & EASY. DATA ENCRYPTED
Applying to multiple lenders is fast and easy with our one simple questionnaire. Choose the product you’re looking for, take a few moments to answer a few questions and you’re on your way to saving.
NO OBLIGATION. NO HIDDEN FEES
Any of the services on our website are 100% free, there is no obligation to use our services or any hidden fees. We’re not loan brokers so we don’t charge broker fees like other websites.
NO SSN OR CREDIT CHECK
No SSN or credit check is necessary to use our services. We bring lenders to you so they can compete for your business and you save. That information only becomes necessary after you choose a lender.

March 30, 2011 (Jeff Alan)
mortgage-book-image
Shortly after the release of the proposed risk retention proposal by the various federal agencies, the Mortgage Bankers Association (MBA) released a statement expressing their concerns about the proposal. Although pleased with some of the proposals, calling proposed rules for commercial real estate financing as “workable,” the MBA expressed concerns about the new rules proposed for Qualified Residential Mortgages (QRM).

The response was authored by John A. Courson, President and CEO of the Mortgage Bankers Association. His response to the proposed QRM rules was:

“Related to risk retention for residential mortgages and the qualified residential mortgage (QRM) exemption, we do have concerns about the rigid and highly prescriptive nature of the proposed rule. We believe that such a narrow construct of the risk retention exemption would limit mortgage opportunities for qualified borrowers more than it would reduce the number of problem loans. Further, if the QRM were to be enacted as proposed, it could dramatically limit the role of independent mortgage banks and community lenders, who either don’t have the balance sheet capacity to hold loans or the capital to hold in reserve as retained risk, but have long histories of originating safe and well-underwritten mortgages.”

“While factors like downpayment, debt to income (DTI) ratio and past payment history can be accurate predictors of loan performance, we do not believe that each ought to be considered independently.”

“Rather, the rule should allow for consideration of a borrowers entire credit profile before determining whether risk retention is necessary on a given loan. For example, we believe that a lower downpayment loan could be less risky if a borrower has a strong history of making payments on time and if the borrower’s debt to income ratio is on the lower end of the scale. The rule should provide more flexibility in this regard.”

“While we believe that the exemption for loans sold to Fannie Mae and Freddie Mac while they remain in conservatorship will help provide liquidity during the current period of market instability, we do note that such an exemption does little to shrink the government’s footprint in the housing finance system and could slow the return of the private secondary mortgage market.”

You can read the full response on the Mortgage Bankers Associations website.

Tags: MBA, risk retention, QRM, residential mortgages, mortgage banks, down payments, debt-to-income, payment history, borrowers, credit profiles

Source:
Mortgagexplain.com (Image)

Home Buying Tips
Home Selling Tips
About
Mortgages
HOW
MORTGAGELOANRATEUPDATE
WORKS
FILL OUT THE FORM
It all starts here. Select the loan product you want to apply for and complete the subsequent questionnaire.
WE VERIFY & TRANSMIT TO LENDERS
Once we receive your completed questionnaire we verify a couple vital pieces of information and direct your information to our network of lenders, all within minutes.
REVIEW YOUR OFFERS
With offers in hand you can now compare rates and costs and get the best possible deal. Comparison shopping made easy. You fill out one form and lenders compete for your business.
CHOOSE YOUR LENDER
Congratulations! With the great learning tools we provide for you at MortgageLoanRateUpdate and the offers you have received, you've found the right product and the best rate.
ADVANTAGES OF USING
MORTGAGELOANRATEUPDATE
FAST & EASY. DATA ENCRYPTED
Applying to multiple lenders is fast and easy with our one simple questionnaire. Choose the product you’re looking for, take a few moments to answer a few questions and you’re on your way to saving.
NO OBLIGATION. NO HIDDEN FEES
Any of the services on our website are 100% free, there is no obligation to use our services or any hidden fees. We’re not loan brokers so we don’t charge broker fees like other websites.
NO SSN OR CREDIT
CHECK
No SSN or credit check is necessary to use our services. We bring lenders to you so they can compete for your business and you save. That information only becomes necessary after you choose a lender.