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Government relaxes mortgage down payment rules

Government relaxes mortgage down payment rules

CBS News is reporting that the Government is relaxing mortgage down payment rules.

The proposed new Qualified Residential Mortgage rule, released jointly by six government agencies, was cheered by both consumer advocates and mortgage industry members–who typically don’t see eye-to-eye on much–largely because it eliminates much stricter down payment rules that the previous version of QRM would have created.

The six agencies–the Federal Reserve Board, the FDIC, the Federal Housing Finance Agency, the Department of Housing and Urban Development, the Office of the Comptroller and Currency and the Securities and Exchange Commission–are taking comments on the proposed changes through the end of October.

Under the old rule, the requirement was going back to a 20% downpayment. The new rule will have the mortgage lender evaluate the applicant on an individual basis.

Many of those comments attacked the original QRM rules. The proposed changes, on the other hand, are causing nearly universal joy to ripple through housing and mortgage groups.

“This new proposal shows that regulators listened to the comments from the wide range of stakeholders involved,” said Chris Estes, president and CEO of the National Housing Conference, an affordable housing advocacy group. “Aligning the QRM rule with the QM rules will allow more American families to become homeowners and ensures that housing markets can remain strong in the future. This is especially important for communities that are still rebuilding from the foreclosure crisis.”

If you have questions about eligibility for a mortgage, talk to a professional loan officer. They diligently study the news and market and stay on top of the interest rate trends. They also are in touch with many lenders to find the best package for your situation.


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