Some Home Buyers Face More Hurdles in 2014

San Francisco, Nov. 11, 2013 -- In a rare gathering of CEOs and senior executives from the biggest names in mortgage lending, Realtors were told to expect market growth in 2014 and to prepare their buyers for transactions with heavy documentation requirements.

NAR President Gary Thomas and CEO Dale Stinton moderated the discussion Sunday during the “Straight from the Top: Insights from Lending Leaders” session at the 2013 Realtors Conference and Expo, where the top mortgage industry executives expounded on new regulatory hurdles that could temporarily restrict lending to some buyers, but will likely even out over time.

The Qualified Mortgage, or ability-to-repay rule, will become effective in January 2014 and contains a number of underwriting standards that will constrict mortgage availability and deny credit to some first-time homebuyers, said Bill Emerson, CEO of Quicken Loans.

The QM rule requires significant documentation from consumers to justify lenders’ underwriting decisions; lenders face strict penalties if a loan is made outside of the specific criteria.

Kevin Watters, CEO of JPMorgan Chase, agreed that lower- and moderate-income buyers, as well as self-employed buyers who don’t have a consistent flow of income, might have a tougher time in the new lending environment. “We need to work together to help first-time buyers into affordable housing options.”



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