American Banker: “One of the most important pieces of the Dodd-Frank Act is set to start falling into place Tuesday as regulators offer a plan that would establish stringent underwriting standards for most mortgages, provide limited new rules for servicers, and detail how institutions must retain some risk of loans they intend to sell to the secondary market. The risk retention proposal is likely to draw protests from the banking industry and concern from lawmakers because it is so sweeping and may reshape the entire lending business. According to a summary of the plan obtained by American Banker, regulators are proposing strict criteria for what loans are exempt from risk retention requirements, including mandating a 20% borrower downpayment, compliance with certain debt-to-income ratios and limits depending on a borrower’s credit history. The so-called “qualifying residential mortgage” test is one of the most important pieces of the risk retention plan because many lenders are hoping to make loans exclusively according to those terms.”