The National Community Reinvestment Coalition and other housing advocates teamed with banking interests to address concerns over what stipulates a "qualified mortgage" under a new rule expected from the Consumer Financial Protection Bureau this year. The rule will require lenders to verify a borrower's repayment ability, unless he or she is taking out a QM. The trade and industry organizations joined forces to dispatch a letter to the CFPB on April 16, urging the regulator to broadly define the term. A narrow definition applicable only to a fraction of products and borrowers, they warned, would make lenders skittish about non-QM loans and, in turn, inflate the costs and risks of those products. A broad definition "is the only way to help the economy and at the same time ensure that the largest number of credit-worthy borrowers are able to access safe, quality loan products for all housing types, as Congress intended" under the Dodd-Frank financial reform law, the letter declared.
Web Link - May Require Paid Subscription