<html><head><meta http-equiv="Content-Type" content="text/html charset=windows-1252"></head><body style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><span class="Apple-Mail-URLShareSharedContentClass" style="position: relative !important; "><div class="original-url"><img id="868ff8ef-bb04-49b7-9f2d-12869af034a9" height="18" width="122" apple-width="yes" apple-height="yes" src="cid:30FEDD21-DCF4-46FD-8737-300EDAA1F911@att.net"></div><div class="original-url"><a href="http://www.nytimes.com/2013/08/29/business/economy/us-plan-eases-rules-for-mortgage-lenders.html?src=recpb&_r=0">http://www.nytimes.com/2013/08/29/business/economy/us-plan-eases-rules-for-mortgage-lenders.html?src=recpb&_r=0</a><br><br></div><div id="article" class="auto-hyphenated" style="-webkit-hyphens: auto; "><div class="page" style="font-size: 14px; font-family: Palatino, Georgia, Times, 'Times New Roman', serif; line-height: 1.4; text-align: justify; "><h1 class="title" style="font-size: 21px; line-height: 1.25em; text-align: start; -webkit-hyphens: manual; ">U.S. Plan Eases Rules for Mortgage Lenders</h1><nyt_correction_top style="font-size: 16px; "></nyt_correction_top><span style="font-size: 16px; "></span><p itemprop="articleBody" style="font-size: 16px; ">WASHINGTON — Six federal regulatory agencies released a reworked proposal on Wednesday that would require lenders to maintain a stake in the loans they bundle and sell as securities, part of efforts to limit the type of underwriting practices that fed the housing bubble.</p><p itemprop="articleBody" style="font-size: 16px; ">But the proposal also expanded the range of mortgages that would be exempt from the requirement.</p><p itemprop="articleBody" style="font-size: 16px; ">The new rules, the <a title="Previous coverage of the plan." href="http://query.nytimes.com/gst/fullpage.html?res=9B05E2DD1F3DF933A05750C0A9679D8B63" style="text-decoration: none; color: rgb(32, 0, 127); ">latest version of a 2011 proposal</a>, were required under the Dodd-Frank Act of 2010. Mortgages to borrowers who do not have to spend big chunks of their monthly income repaying the debt will be exempt from the requirement.</p><p itemprop="articleBody" style="font-size: 16px; ">The regulators’ plan would exempt more loans than earlier proposals by eliminating a requirement that so-called qualified residential mortgages include a large down payment.</p><p itemprop="articleBody" style="font-size: 16px; ">Housing industry and consumer groups have lobbied for more than two years against that requirement, which they said would harm the housing market recovery.</p><p itemprop="articleBody" style="font-size: 16px; ">“Our goal as regulators is to provide clear rules that allow for robust markets that meet the needs of creditworthy borrowers in a safe and sound manner,” said Paul M. Nash, a senior official at the <a href="http://topics.nytimes.com/top/reference/timestopics/organizations/c/comptroller_of_the_currency/index.html?inline=nyt-org" title="More articles about Comptroller of the Currency" style="text-decoration: none; color: rgb(32, 0, 127); ">Office of the Comptroller of the Currency</a>. “I believe the rule, as reproposed today, helps accomplish just that.”</p><p itemprop="articleBody" style="font-size: 16px; ">The new rules are aimed at preventing banks from writing risky loans with impunity.</p><p itemprop="articleBody" style="font-size: 16px; ">In the years leading up to the financial crisis, banks used shoddy underwriting standards under the assumption that they could sell loans to investors and avoid harm if the borrowers defaulted.</p><p itemprop="articleBody" style="font-size: 16px; ">The Dodd-Frank law called for lenders and bond issuers to hold 5 percent of those loans on their books, giving them more incentive to make better loans.</p><p itemprop="articleBody" style="font-size: 16px; ">Regulators originally said that banks and bond issuers would have to hold part of the securitized loans on their books for all loans except mortgages that included a 20 percent down payment.</p><p itemprop="articleBody" style="font-size: 16px; ">After criticism from housing and consumer groups, regulators decided to drop the down payment requirement.</p><p itemprop="articleBody" style="font-size: 16px; ">Instead, they said on Wednesday that mortgages that met a minimum standard already adopted by the federal <a href="http://topics.nytimes.com/top/reference/timestopics/organizations/c/consumer_financial_protection_bureau/index.html?inline=nyt-org" title="More articles about the Bureau of Consumer Financial Protection." style="text-decoration: none; color: rgb(32, 0, 127); ">Consumer Financial Protection Bureau</a> would be exempt.</p><p itemprop="articleBody" style="font-size: 16px; ">The agencies will seek public comment for 60 days before holding a final vote on the new rule.</p><nyt_correction_bottom style="font-size: 16px; "><div style="font-style: italic; "><br class="webkit-block-placeholder"></div></nyt_correction_bottom><nyt_update_bottom style="font-size: 16px; "></nyt_update_bottom><span style="font-size: 16px; "></span></div></div></span><span class="Apple-Mail-URLShareUserContentBottomClass" style="line-height: 14px !important; text-align: left !important; "></span></body></html>