Qualified Residential Mortgage

If the federal regulators' proposed definition of the Qualified Residential Mortgage (QRM) had been in effect last year, nearly 40% of originations would have failed to meet the 20% down-payment requirement, CoreLogic reports.


In a mortgage-trends publication released this week, the data provider notes that 39% of 2010 originations had a loan-to-value (LTV) ratio about 80%.

"Even if the down-payment constraint is moved down to 10 percent, the impact is large because nearly one-quarter of all 2010 originations had higher LTV ratios," CoreLogic says in its report.

The proposed 20% down-payment standard would cause more sluggish sales in some states in the short term, CoreLogic says. According to the company's analysis, the down-payment requirement would have the least effect in New York, Hawaii and North Dakota, and the greatest impact on sales in Georgia and Colorado, which are examples of states that have a lower-than-average share of below-80% LTV loans.