Consensus comments at the Mortgage Bankers Association's (MBA's) National Secondary Market Conference & Expo in New York City in May reflected considerable trepidation about Qualified Residential Mortgage (QRM) rules emanating from the Dodd-Frank Wall Street Reform and Consumer Protection Act. Tom Deutsch, executive director of the American Securitization Forum (ASF), New York, said: "QRM is still too tight. Some great loans would not meet those standards as currently written," using as an example a retiree with a lot of cash but no current job income. "There is a whole lot of gray area with mortgage origination; all kinds of issues," Deutsch noted, adding on another topic that when it comes to efforts of "keeping people in their homes at nearly any cost, we really need to rip the Band-Aid[R] off. There are borrowers out there who will not be able to stay in their homes." Deutsch went on: "I'm scared to death of the shadow inventory ... that lends itself further to problems. Letting people live in their homes for free really doesn't generate a lot of interest [among investors] to buy more mortgage-backed securities."
