Who hasn't ever the dreaded words, "We need to talk?” Yo
u’re having dinner at a nondescript restaurant with bus boys bustling around, waiters taking orders, and then out of the blue you hear those dreaded words: "It's over, Tim.” Then two weeks later your old girlfriend is going out with the jackass nobody liked in high school. I've been watching a little more ABC lately, and that means I’m watching The Bachelorette. The darling of the show has fallen in love with the incorrigible asshole Bentley. Not only is he not the one for our lovable friend Ashley Hebert, it’s obvious he gets some sick kick out of seeing her cry. It seems like since he's left, all she does in every episode is go on dates and wax poetic about him.
The US Real Estate industry is in the same place. We got "done dirty" by loans with bad terms, very easy money, and imbecile regulators.As a result, we are mired in one of the worst real estate markets in decades. Now that we've been shocked back to reality, Congress is trying to put together sensible rules to keep us on the straight and narrow. The largest hangup for the industry is the Qualified Residential Mortgages (QRM) rules. The QRM guidelines seem like the astute, conservative way to prevent further housing disaster. You know, kind of the safe "ivy league boyfriend." But, true to form, Ashley/people are clamoring for Bentley – the “bad guy,” the exciting, less restrictive mortgage options. The worst thing is that there are tons of groups that want to get behind this move to lower the QRM standards. Legislators, the National Association of Realtors (NAR), the National Association of Home Builders (NAHB), and NA whatever else you want – just about anybody else who is about to have a big old bite taken out of their pie.
The harsh reality is that in the long run, the conservative Ivy League boyfriend is going to have to 
be hardworking, but will also ultimately enjoy prosperity.Going with the bad boy Bentley and all his easy lending ways seems to be a one way ticket to all of us living in a trailer with our parents.There are a lot of people with a lot invested in how these QRM rules take shape. The last time those with the most to gain ran amok on a sugar high, the rest of us were left to clean up the mess. Having a defined framework to create reasonable mortgages may be a positive development. Even if that means we have to stop dating guys named after cars, sporting bad hair cuts.
-The Inside Associate
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