House Passes Tweak to Loosen QM Rule

June 11, 2014
American Banker 
mortgage lending news
The Mortgage Choice Act won House approval by way of a late June 9 voice vote.

The measure would count neither insurance and taxes held in escrow nor fees paid to affiliated companies as "points and fees," which are limited to 3 percent of the total loan cost under the Consumer Financial Protection Bureau's qualified mortgage (QM) rule.

The act aims "to promote access to affordable mortgage credit without overturning the important consumer protections and sound underwriting required under Dodd-Frank's 'ability to repay' provisions," said Rep. Bill Huizenga (R-Mich.), who co-sponsored the bill with Rep. Gregory Meeks (D-N.Y.) "These common-sense changes will promote access to affordable mortgage credit for low and moderate income families and first-time homeowners by ensuring that safer, properly underwritten mortgages pass the QM test."

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