Proposed 20% down payment rule could put owning a home out of reach for many

I will be glad when the government gets a handle on this housing crisis. I know there is alot going on, but too many people are losing their homes. And not enough people are being able to purchase homes. The banks are making it tougher to buy homes not easier. Why can't the government force the banks to forgive the bad loans, refinance so people can afford their mortgages again? If the homes go into foreclosure, everyone loses.

After a disaster, people often want to figure out how to avoid the debacle again.

As we continue to deal with the fallout from the housing crisis, regulators working under the Dodd-Frank Wall Street Reform and Consumer Protection Act are proposing rules to prevent folks from getting into homes they can’t afford. One would require borrowers to come up with a 20 percent down payment. If they don’t meet this threshold, their loans would be considered more risky. It would not be a “qualified residential mortgage,” or QRM, and therefore the bank would charge more for it.

“Why, in a law intended to fix the mistakes that caused the credit crisis, would you mandate a certain down payment when low down payments were not the problem?” said Kathleen Day, spokeswoman for the Center for Responsible Lending.

I’m wondering the same thing.

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