Submitted to the Washington Post

The editorial, “A Dodd-Frank capitulation on mortgage down payments”, presents a wholly inaccurate picture of the new mortgage rule recently proposed by federal regulators. Contrary to the author’s assertion, the housing crisis was not caused by low down payment lending, but rather by faulty underwriting and the introduction of complex loan products that too many consumers didn’t understand. The Qualified Mortgage (QM) rule and the re-proposed Qualified Residential Mortgage (QRM) rule adequately address these issues.
In fact, QRM as re-proposed will do precisely what Dodd-Frank intended: help avoid another meltdown in the mortgage-backed security market by prescribing product underwriting and documentation standards that ensure sustainable lending and protect investors and consumers alike.  It is ill-informed to suggest that the absence of a large down payment requirement in the rule fails to live up to Dodd-Frank, or will lead to higher defaults. In fact, a review of the legislative history clearly demonstrates Congressional intent to steer clear of a minimum down payment requirement.
Aligning QRM and QM was the right decision.

Realtor® Gary Thomas, on behalf of The Coalition for Sensible Housing Policy

(The Coalition for Sensible Housing Policy is a diverse coalition of 50 consumer organizations, civil rights groups, lenders, and real estate professionals united in their opposition to high down payment requirements that could freeze credit-worthy Americans out of the housing market,

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