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Today, I received this plea from my broker:

Tell Congress: 20% Down Payments Put the American Dream Out of Reach
Could your clients afford a 20% down payment? Could you? Can you envision what your prospective client pool will look like if new regulations governing Qualified Residential Mortgages (QRM) take effect this year?

Neither can we. And neither can many elected officials in Congress who did not intend for these regulatory provisions to be so narrowly defined. We must continue our efforts to explain how detrimental the new QRM rules would be to the ongoing housing and lending crisis in America.

According to NAR Research, 60% of recent home buyers made less than a 20% down payment, and it would take 14 years for a typical person to save up a 20% down payment to buy a median-priced home.

Please contact Congress today and ask them to make it clear to the regulators that this proposed regulation was not their legislative intent and to instead implement a more reasonable Qualified Residential Mortgage (QRM) that will keep credit-worthy buyers in the market and able to acquire a loan.

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Message Subject: Subject: Ask Federal Regulators to follow Dodd-Frank intent of QRM exemption provisions

Dear [Decision Maker],

As both a constituent and one of a million members of the National Association of REALTORS, I believe that our economic recovery depends largely on a housing market recovery. Implementing a new rule requiring a twenty percent or higher down-payments would stop the housing recovery in its tracks.
That is what will happen if the restrictions in the proposed Qualified Residential Mortgage (QRM) regulation are implemented. It is my belief that this was not your legislative intent.
I am writing to ask you as my Senators and Representative to sign on to a letter being circulated by your colleagues, Senators Landrieu (D-LA), Isakson (R-GA), and Hagan (D-NC). In the House, Representatives Campbell (R-CA), Sherman (D-CA), Perlmutter (D-CO), Capito (R-WV), Moore (D-WI), Miller (R-CA), Himes (D-CT) and Posey (R-FL) are circulating a similar letter. Both letters ask Federal Regulators to follow the intent and language of the QRM exemption provision contained in the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The proposed QRM rule would create an enormous down-payment requirement and reduce the availability of affordable mortgages for qualified consumers. Few borrowers would be able to meet these requirements and those that do would be forced to pay much higher rates and fees for safe loans did not meet the exceedingly narrow QRM criteria.

Congress included the QRM to exempt safe, well-underwritten mortgages from the risk retention requirements. Well-underwritten loans, regardless of down payment, were not the cause of the mortgage crisis.
I urge you to insist that regulators to follow congressional intent. Please sign the Landrieu-Hagan-Isakson letter or the Sherman-Campbell letter today to help keep the American Dream of Home Ownership in reach.

Sincerely,

MY RESPONSE:

As a realtor, I have seen too many homes sold to people that simply can't afford them. We have watched Fannie and Freddie become dumping grounds for billions in low down payment loans that were defaulted on forcing the taxpayers to eat the losses. I believe that the federal government should not guarantee any loans and that only prudent borrowers should own homes. FHA is nothing but a welfare program putting people into homes that they will never pay off. The banks should be forced to hold on to their own paper or sell to investors, but most importantly, the taxpayers should not be forced to eat these losses. It is time for congress to shut down Fannie and FAnnie and quit taking their orders from the special interest groups that don't give a damn about the taxpayers.

#housing