New Mortgage Rule Plays Into Fannie, Freddie Reform Efforts

Law360, New York (August 28, 2013, 8:04 PM EDT) -- Federal regulators on Wednesday agreed to relax a proposal requiring banks to keep a stake in the mortgages they securitize, a decision experts say should help drive private investors into the secondary mortgage market and provide lawmakers ample room to reform the government's role in housing finance.

The newly proposed version of the Dodd-Frank Act-mandated risk retention rule put forward by six federal regulators would still force banks to hold a 5 percent stake in mortgage-backed securities that contain home loans with a higher risk of...
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