We’re gonna keep pounding this QRM thing because it’s critical for your business.

QRM: Qualfiied Residential Mortgage. A mortgage that meets certain requirements, and thus one that Fannie and Freddie will be willing to buy from lenders. But what will make a loan “qualify”? Federal regulators are considering making a 20% down payment part of the qualifications.

Sure, banks could loan to someone who puts less than 20% down — but only if they’re not planning to sell the loan to F&F (which own something like 90% of the secondary mortgage market). So whatever the QRM standard is going to be, you know it’s going to be the de facto mortgage standard.

Can you imagine if a 20% down payment was the only way to get a low-interest mortgage? How well do you think that would work? Hint: In the last 12 months, 60% of home buyers have put down less than that. And you know how hard it’s been to get a mortgage, so these are the folks with the great credit ratings — and they’re not shelling out $40,000 or $50,000 as a down payment.

Thus, the Call for Action: Don’t let federal regulators set the QRM bar so high. It’s one thing to ensure that reasonable standards are being met, but it’s another thing to price out 60% of the market.

Give a two-and-a-half minute listen to NAR President Ron Phipps explaining what we have to do. Then go to NAR’s Realtor® Action Center where it only takes a couple of clicks to tell your congressmen to rein in the regulators before they go too far.

Without your voice, you could end up telling your clients, “Come back when you’ve got 40 grand in cash. Then we can go house shopping.”