NAR is seeking Congressional support for H.R. 273 and S. 3541.  H.R.
273 and S. 3541 provide a long-term solution to maintain access, for growing
communities, to the United States Department of Agriculture, Rural Housing
Service Section 502 Program.

Only Congress can prevent more than 900 growing communities in 48 states from
losing eligibility for the Section 502 Program. Currently, the Section 502
Program provides federal backing for mortgages allowing smaller, community
based lenders to offer safe and affordable mortgages to home-buyers in growth
areas. 

Urge Congress to help keep alive the American Dream of Homeownership for
thousands of potential homeowners across the nation.

use this link for the call 2 ACTION 

What's-at-Stake:

Unless Congress acts quickly, homeowners and prospective owners in more than
900 communities across the country will not have access to the programs of the
Rural Housing Service (RHS).

One program of concern is the Section 502 guaranteed loan program that provides
opportunities for homeownership for rural families. These loans can be used for
a variety of important homeownership needs including purchase and or site
preparation, as just two examples.  RHS insures the loans while 502 loans
are made at no cost to the federal government as the program's costs are fully
supported by the premiums paid by borrowers.

The Senate and House have legislation before them that will extend the program
for 10 years but no final action has occurred on either bill.

Congress needs to act when they return to Washington after the election.

NAR believes Congress intended to create a broad QRM exemption. Evidence shows that responsible lending standards and ensuring a borrower’s ability to repay have the greatest impact on reducing lender risk, not high down payments. Proposals that require high down payments will drive more borrowers to FHA, increase costs for borrowers by raising interest rates and fees, and effectively price many eligible borrowers out of the housing market.

A provision in the Dodd-Frank Act requires that financial institutions retain 5% of the risk on loans they securitize. The purpose is to discourage excessive risk taking and create strong incentives for responsible lending and borrowing.

Congress came up with the QRM concept to ensure that banks were only putting up ‘safe’ loans for securitization. NAR supports this goal, but in practice, regulators have come up with draconian parameters for what constitutes a QRM.

NAR feels this will not only affect buyers, but would also affect the ability of home owners to sell their homes, since there would be fewer buyers who could qualify for home ownership.

NAR wants federal regulators to honor Congressional intent by crafting a QRM exemption that includes a wide variety of traditionally safe, well underwritten products such as 30-, 15-, and 10-year fixed-rate loans; 7-1 and 5-1 ARMs; and loans with down payments in the 5% to 20% range with PMI, where required, and with other features found in low-risk loans such as no prepayment penalties or balloon payments.

 According to NAR Research, 60% of recent home buyers made less than a 20% down payment, and it would take 14 years for a typical person to save up a 20% down payment to buy a median-priced home.

TAKE ACTION NOW! Click on link below and it will automatically send for you!

Please contact Congress today and ask them to make it clear to the regulators that this proposed regulation was not their legislative intent and to instead implement a more reasonable Qualified Residential Mortgage (QRM) that will keep credit-worthy buyers in the market and able to acquire a loan.