Banking Agencies to Vote on Risk Retention & Service Standards

On FDIC’s March 15^th meeting one of the items to be voted on is the risk-retention standards for future qualifying residential mortgage loans. The agreement, details an approval to require potentially new homeowners to place 20 percent or more of a down payment as well as full documented income and restriction on how much payments could adjust by. The agreement also calls for a requirement for a lender to describe how they would handle second mortgage delinquency. Servicers would also be require to offer loss mitigation when a borrower’s home value equity is worth more than its foreclosure value. I’ll be attentive to the results and detail its effect for future residential mortgage lending.

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