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Basel III HVCRE regulations

April 7, 2017

On Monday, April 3, NAR joined an industry coalition letter thanking Rep. Pittenger (R-NC) for his work drafting a bill to make reforms to the Basel III “High Volatility Commercial Real Estate” (HVCRE) risk-weight requirements for lenders.  Under the HVCRE rule, commercial acquisition, development, and construction (ADC) loans are risk-weighted at 150% - up from pre-Basel III levels of 100%.  This change made commercial loans less attractive to lenders than other types with lower risk-weights.  Rep. Pittenger’s draft legislation would clarify aspects of the Basel III rule, including specifically which types of loans are subject to the higher risk-weight and takes steps to ensure that the HVCRE rules are appropriately calibrated so as to provide protection without impeding economic activity.  

NAR looks forward to this legislation being introduced and will continue to support it throughout the legislative process.  

Download the Coalition Letter