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Comments due: CFPB (proposed rule; general QM loan definition)

September 8

The Consumer Financial Protection Bureau (CFPB) proposes to amend the General QM loan definition under the Ability-to-Repay/Qualified Mortgage Rule because it is concerned that retaining the existing General QM loan definition with the 43 percent DTI limit after the Temporary GSE QM loan definition expires would significantly reduce the size of QM and could significantly reduce access to responsible, affordable credit. The Bureau is proposing a price-based General QM loan definition to replace the DTI-based approach because it preliminarily concludes that a loan’s price, as measured by comparing a loan’s annual percentage rate (APR) to the average prime offer rate (APOR) for a comparable transaction, is a strong indicator of a consumer’s ability to repay and is a more holistic and flexible measure of a consumer’s ability to repay than DTI alone.

Reg lookup: Qualified Mortgage Definition under the Truth in Lending Act (Regulation Z): General QM Loan Definition


September 8
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