MBA Reacts to Risk Retention Re-Proposal

                                         

WASHINGTON, D.C. (Aug. 28, 2013) – David H. Stevens, President and CEO of the Mortgage Bankers Association (MBA), issued the below statement following today's re-proposal of the risk retention rule.

David H. Stevens

“The re-proposed rule is a reflection of how well the notice and comment process can work.  Regulators proposed a rule and received a unanimous reaction from diverse groups within housing and real estate finance that the proposal would have unduly constrained  the availability of mortgage credit for many borrowers.

“As a result the regulators recognized the implications for consumers and the broad mortgage markets, and decided to alter and then re-propose a much better rule.

“We are extremely pleased with the proposal that aligns the Qualified Mortgage (QM) and Qualified Residential Mortgage (QRM) definitions for risk retention purposes.

“It is important to note that the risk retention rule impacts other asset classes including commercial mortgage-backed securities (CMBS). In that vein, MBA is gratified that the Premium Capture Cash Reserve Account (PCCRA) proposal was eliminated from the re-proposal. 

"The PCCRA would have required all issuer profits to be placed in a first-loss position, which would have eliminated the financial incentive for issuing CMBS.

“MBA applauds the regulators for carefully balancing the competing policy objectives in this rule, and looks forward to continuing to work with them to ensure that other portions of this rule are strengthened in order to bolster the real estate markets and also protect borrowers and investors.”

For a complete copy of the company’s news release, please contact:

Rob Van Raaphorst

(202) 557-2799