Dodd-Frank reform could make it easier to get a mortgage

It should be easier for you to get a mortgage if President Donald Trump signs legislation that will lift lending restrictions on community banks.

Congress on Tuesday voted in favor of rolling back Dodd-Frank banking rules. The reforms would ease some of the mortgage laws from the Dodd-Frank Act of 2010, a massive financial law enacted in response to the financial crisis.

The new changes will allow community banks and credit unions to offer mortgages outside the typical Qualified Mortgage rule so long as they don’t sell that mortgage but keep it in-house. By holding that mortgage on the books, it would be deemed a Qualified Mortgage. The carve-out would apply to institutions with less than $10 billion in assets.

Many lenders think this change would allow more community lenders to offer mortgages. It would also be helpful for homebuyers, when mortgage rates are rising but still low.

It’s unclear how much of an impact a change to the mortgage laws would have on the housing market. A large portion of homebuyers already meet the requirements within the Qualified Mortgage rule. The Urban Institute says the Qualified Mortgage rule has had “little impact” on credit availability, though there are fewer mortgages being offered for under $100,000.

read more at: https://www.bankrate.com/mortgages/dodd-frank-reform-easier-to-get-mortgage/

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