CFPB announces plans to rethink QM rules

The Consumer Financial Protection Bureau said it expects to propose a rule to delay its Qualified Mortgage rule’s July 1 mandatory compliance date.

 

QM Rules: In a statement and blog post from CFPB Acting Director Dave Uejio, the bureau also said it is considering whether to initiate a rulemaking to revisit the QM rule and a separate rule creating a new category of "seasoned" QMs.

 

GSE Patch: The CFPB also indicated that the "GSE patch," which exempts Fannie Mae and Freddie Mac mortgage loans from parts of the QM rule, will remain in effect until a new mandatory compliance date is set.

 

Background: The CFPB's general QM rule replaces the 43 percent DTI limit with an approach based on loan pricing. The "seasoned" QM rule would allow non-QM mortgages to “season” into QMs based on strong performance over 36 months.

 

ICBA Position: ICBA has repeatedly expressed concerns with the QM rule's use of loan pricing to determine the borrower's ability to repay a loan, which favors the largest mortgage lenders. Instead, ICBA has advocated a hybrid approach that retains a range of DTI thresholds.