Consumer Financial Protection Bureau (CFPB) director Richard Cordray defended the agency's new mortgage rules, data-gathering activities, and leadership structure during a June 19 speech. The ability-to-repay rule and the creation of ultra-safe "qualified mortgages" (QM) will neither significantly raise the cost of most home loans nor hinder credit availability, he stressed, despite warnings from lenders that few banks will want to make loans that do not satisfy the QM standard. Cordray added that the average cost for a non-QM loan is estimated to be less than 10 basis points higher than a QM. He also noted that the CFPB agrees with estimates from Mark Zandi of Moody's Analytics, who figures that about $20 billion of the $1.25 trillion mortgage market would fall outside of the QM definition -- meaning that the QM rule would cover more than 98 percent of the current market. Bankers and lawmakers also have raised concerns about how the bureau uses its findings from data gathering, but Cordray said that a lack of comprehensive data available in past years has rendered such activities necessary and that information now being gathered will help prepare the watchdog's future director.
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