A few months ago, industry groups seemed resigned that Congress might impose a 5% risk retention requirement on mortgage securitizations, but now legislation is headed for a committee markup that pushes the "skin in the game" bar to 10% which has many concerned.

"The 10% requirement is unstudied and could have a significant negative impact on mortgage finance," said Scott Talbott, a lobbyist for the Financial Services Roundtable.  Talbott warned House Finance Financial Services members in his testimony that requiring lenders to retain that much credit risk would "significantly limit" their capacity to extend mortgage credit.

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