There are three major new regulations shaping the housing finance market: QM (qualified mortgage), QRM (qualified residential mortgage) and Reg X. QM is a safe harbor from the statutory ability-to-repay requirement that applies to all mortgages. QRM is a safe harbor from the statutory risk retention requirement that applies to mortgage securitization. And Reg X are the new mortgage servicing regulations. It’s important to understand how these three regulations interact and how they’re going to affect the housing finance market. (There’s also new TILA/RESPA disclosure stuff, but I don’t think that’s particularly impactful, in part because I don’t think disclosure regulation is especially effective in most real world circumstances.)
via QRM’s Missed Opportunities for Financial Stability and Servicing Reform – Credit Slips.