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Risk Retention Proposal Released
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You're Now Reading:
Risk Retention Proposal Released
The Easy Way to Shop For a Mortgage Loan
Fill Out One Questionnare
Receive Multiple Offers. Save Money.
The Easy Way to Shop For a Mortgage Loan
Fill Out One Questionnare
Receive Multiple Offers. Save Money.
You're Now Reading:
Risk Retention Proposal Released
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March 30, 2011 (Chris Moore)
mortgage-whitehouse-image
Seven agencies of the federal government jointly released the risk retention proposal mandated in the Dodd-Frank Refinance Reform Bill. The 233 page report defines “Qualified Residential Mortgages (QRM)” and provides additional guidance on requirements for commercial real estate and automobile loans.

A QRM is a home loan that would exempt a mortgage lender from a 5 percent retention in each home loan that it originates and is packaged for securitization. If all the loan qualifications meet or exceed the requirements of a QRM, the bank would no longer be required to retain the 5 percent share of the loan and would have no future risk if the borrower should default.

Here’s a brief summary from the report that details what qualifies as a QRM:

– A QRM must be secured by a first lien mortgage only, cannot exceed 30 years and must be a one-to-four family property.
– The proposed rule prohibits the use of a junior lien in conjunction with a QRM to purchase home.
– A mortgage loan could qualify as a QRM only if the borrower was not currently 30 or more days past due, in whole or in part, on any debt obligation, and the borrower had not been 60 or more days past due, in whole or in part, on any debt obligation within the preceding 24 months. Further, a borrower must not have, within the preceding 36 months, been a debtor in a bankruptcy proceeding, had property repossessed or foreclosed upon, engaged in a short sale or deed-in-lieu of foreclosure, or been subject to a Federal or State judgment for collection of any unpaid debt.
– The proposed rules would prohibit QRMs from having, among other features, payment terms that allow interest-only payments or negative amortization. Borrowers would be prohibited from deferring interest or repayment of principal. “Balloon” payment loans would also be prohibited.
– Both fixed rate and adjustable rate mortgages may qualify (ARM) as a QRM, however an ARMs interest rates would be restricted to no more than a two percent increase in any twelve month period and six percent for the life of the loan.
– Creditors who offer a loan with a prepayment penalty would also have to offer a loan without a prepayment penalty.
– Points and fees for a QRM may not exceed three percent of the total loan amount.
– 20 percent down payment requirement. There are various rules based upon the appraised value of the home…too many to list, but they can found on page 80.
– Debt ratio cannot exceed 28 percent for the house payment and 36 percent for total obligations.
– A QRM could not be assumable by any person who was not a borrower under the original mortgage transaction.

The proposal also sets forth policies in regards to mortgage servicers responsibility in the event of a default.

At this time, while Freddie Mac and Fannie Mae are under government conservatorship, they will be exempt from the QRM requirement, as will FHA and VA loans, which altogether currently make up 87 percent of all mortgage loans originated. If implemented today, QRM would only apply to approximately 13 percent of all mortgage loans originated.

If you’d like to read the whole proposal (I know you’re all just dying to) you can view it here.

Tags: risk retention proposal, QRM, Dodd-Frank, home loans, mortgage lenders, five percent retention, qualified residential mortgages

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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
LOANRATEUPDATE
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 LoanRateUpdate. 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
LOANRATEUPDATE
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.
Home Buying
Tips
Home Selling
Tips
About
Mortgages
Mortgage
Calculator
Mortgage
Rates

March 30, 2011 (Chris Moore)
mortgage-whitehouse-image
Seven agencies of the federal government jointly released the risk retention proposal mandated in the Dodd-Frank Refinance Reform Bill. The 233 page report defines “Qualified Residential Mortgages (QRM)” and provides additional guidance on requirements for commercial real estate and automobile loans.

A QRM is a home loan that would exempt a mortgage lender from a 5 percent retention in each home loan that it originates and is packaged for securitization. If all the loan qualifications meet or exceed the requirements of a QRM, the bank would no longer be required to retain the 5 percent share of the loan and would have no future risk if the borrower should default.

Here’s a brief summary from the report that details what qualifies as a QRM:

– A QRM must be secured by a first lien mortgage only, cannot exceed 30 years and must be a one-to-four family property.
– The proposed rule prohibits the use of a junior lien in conjunction with a QRM to purchase home.
– A mortgage loan could qualify as a QRM only if the borrower was not currently 30 or more days past due, in whole or in part, on any debt obligation, and the borrower had not been 60 or more days past due, in whole or in part, on any debt obligation within the preceding 24 months. Further, a borrower must not have, within the preceding 36 months, been a debtor in a bankruptcy proceeding, had property repossessed or foreclosed upon, engaged in a short sale or deed-in-lieu of foreclosure, or been subject to a Federal or State judgment for collection of any unpaid debt.
– The proposed rules would prohibit QRMs from having, among other features, payment terms that allow interest-only payments or negative amortization. Borrowers would be prohibited from deferring interest or repayment of principal. “Balloon” payment loans would also be prohibited.
– Both fixed rate and adjustable rate mortgages may qualify (ARM) as a QRM, however an ARMs interest rates would be restricted to no more than a two percent increase in any twelve month period and six percent for the life of the loan.
– Creditors who offer a loan with a prepayment penalty would also have to offer a loan without a prepayment penalty.
– Points and fees for a QRM may not exceed three percent of the total loan amount.
– 20 percent down payment requirement. There are various rules based upon the appraised value of the home…too many to list, but they can found on page 80.
– Debt ratio cannot exceed 28 percent for the house payment and 36 percent for total obligations.
– A QRM could not be assumable by any person who was not a borrower under the original mortgage transaction.

The proposal also sets forth policies in regards to mortgage servicers responsibility in the event of a default.

At this time, while Freddie Mac and Fannie Mae are under government conservatorship, they will be exempt from the QRM requirement, as will FHA and VA loans, which altogether currently make up 87 percent of all mortgage loans originated. If implemented today, QRM would only apply to approximately 13 percent of all mortgage loans originated.

If you’d like to read the whole proposal (I know you’re all just dying to) you can view it here.

Tags: risk retention proposal, QRM, Dodd-Frank, home loans, mortgage lenders, five percent retention, qualified residential mortgages

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
LOANRATEUPDATE
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 LoanRateUpdate. 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
LOANRATEUPDATE
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 (Chris Moore)
mortgage-whitehouse-image
Seven agencies of the federal government jointly released the risk retention proposal mandated in the Dodd-Frank Refinance Reform Bill. The 233 page report defines “Qualified Residential Mortgages (QRM)” and provides additional guidance on requirements for commercial real estate and automobile loans.

A QRM is a home loan that would exempt a mortgage lender from a 5 percent retention in each home loan that it originates and is packaged for securitization. If all the loan qualifications meet or exceed the requirements of a QRM, the bank would no longer be required to retain the 5 percent share of the loan and would have no future risk if the borrower should default.

Here’s a brief summary from the report that details what qualifies as a QRM:

– A QRM must be secured by a first lien mortgage only, cannot exceed 30 years and must be a one-to-four family property.
– The proposed rule prohibits the use of a junior lien in conjunction with a QRM to purchase home.
– A mortgage loan could qualify as a QRM only if the borrower was not currently 30 or more days past due, in whole or in part, on any debt obligation, and the borrower had not been 60 or more days past due, in whole or in part, on any debt obligation within the preceding 24 months. Further, a borrower must not have, within the preceding 36 months, been a debtor in a bankruptcy proceeding, had property repossessed or foreclosed upon, engaged in a short sale or deed-in-lieu of foreclosure, or been subject to a Federal or State judgment for collection of any unpaid debt.
– The proposed rules would prohibit QRMs from having, among other features, payment terms that allow interest-only payments or negative amortization. Borrowers would be prohibited from deferring interest or repayment of principal. “Balloon” payment loans would also be prohibited.
– Both fixed rate and adjustable rate mortgages may qualify (ARM) as a QRM, however an ARMs interest rates would be restricted to no more than a two percent increase in any twelve month period and six percent for the life of the loan.
– Creditors who offer a loan with a prepayment penalty would also have to offer a loan without a prepayment penalty.
– Points and fees for a QRM may not exceed three percent of the total loan amount.
– 20 percent down payment requirement. There are various rules based upon the appraised value of the home…too many to list, but they can found on page 80.
– Debt ratio cannot exceed 28 percent for the house payment and 36 percent for total obligations.
– A QRM could not be assumable by any person who was not a borrower under the original mortgage transaction.

The proposal also sets forth policies in regards to mortgage servicers responsibility in the event of a default.

At this time, while Freddie Mac and Fannie Mae are under government conservatorship, they will be exempt from the QRM requirement, as will FHA and VA loans, which altogether currently make up 87 percent of all mortgage loans originated. If implemented today, QRM would only apply to approximately 13 percent of all mortgage loans originated.

If you’d like to read the whole proposal (I know you’re all just dying to) you can view it here.

Tags: risk retention proposal, QRM, Dodd-Frank, home loans, mortgage lenders, five percent retention, qualified residential mortgages

Home Buying Tips
Home Selling Tips
About
Mortgages
HOW
LOANRATEUPDATE
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 LoanRateUpdate and the offers you have received, you've found the right product and the best rate.
ADVANTAGES OF USING
LOANRATEUPDATE
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.