TheStreet and NuWireInvestor report that provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act set the stage for higher minimum down payment requirements. The National Association of Realtors (NAR) and 44 other organizations criticize changes that can raise down payments to 20% minimum or more. These fuels fears of more harm to the housing market, which many believe is the real engine that drives the U.S. economy. Concerns voiced by the NAR and others – including those in the manufactured housing industry – is that such provisions in Dodd-Frank will hurt housing values, slow or reverse the fragile economic recovery and kill jobs. While 20% down was once common, with higher housing prices, it could take 16 years for the typical American family to save that sized down payment, according to the NAR. The Mortgage Bankers Association state the QRM (Qualified Residential Mortgage) definition is so restrictive, that “80% of the loans sold to Fannie Mae or Freddie Mac over the past decade would not meet these requirements.” Glen Corso, managing director of the Community Mortgage Banking Project says: “80% of the people won’t be able to get [loans]’ is just crazy.”
