H.R. 685 creates loopholes that allow for the higher fees charged in the lead up to mortgage crisis in 2008. H.R. 685, The Mortgage Choice Act of 2015, would weaken mortgage reforms in the Dodd-Frank Act by creating loopholes allowing higher-fee mortgages to classify as Qualified Mortgages (QM) by exempting certain title insurance fees from the points and fees definition. The provisions of the Dodd-Frank Act are an extension of decades of existing federal law and policy of affiliated title fees being included in cost calculations, due to the history of lenders using affiliates to needlessly charge higher fees to borrowers.
QM loans have certain features, such as prohibition of certain risky features, lower costs, and stronger underwriting requirements that make them safer loans. Lenders who follow the rules and make QM loans receive special legal protections. The consumer and market protections prevent borrowers from having to pay excessive fees that were common during the subprime lending boom. Instead of protecting borrowers and the market, loopholes in H.R. 685 unnecessarily create new incentives to charge higher fees to the borrower.