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New Mortgage Rule Good News for Home Buyers

Thursday, October 23, 2014

On September 22, 2014, financial regulators including the Office of the Comptroller of the Currency, Federal Reserve Board, Federal Deposit Insurance Corporation, Securities and Exchange Commission, Federal Housing Finance Agency and Housing and Urban Development, issued final rules to define a Qualified Residential Mortgage (QRM). The new rules are meant to define the risk retention rules for lenders as called for in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

Center for Responsible Lending Vice President of Federal Affairs Ken Edwards made the following remarks on the release of the final Qualified Residential Mortgage Rule:

This is another important step toward a return to sustainable lending and expanding access to credit for qualified homebuyers. Today, many credit-worthy families still find themselves locked out of homeownership because of overly restrictive lending. Recently released data on mortgage originations illustrate the continuing obstacles faced by African-American and Latino households.

Opening up the credit box for all credit-worthy borrowers is the key to jumpstarting the housing market and growing the larger economy.

In finalizing the QRM rule, regulators rightly adopted nearly identical standards that the CFPB used in defining a Qualified Mortgage (QM). Together, the two rules address the largest abuses in mortgage lending during the lead up to the economic crisis. Harmonizing these mortgage rules ensures that homeownership is in greater reach for creditworthy families, while also providing added regulatory certainty and clarity for lenders, investors, and other market participants.

By dropping down-payment requirements, the rules recognize that responsible loan terms and diligent underwriting standards are the determining factors in rebuilding a safe and sustainable housing market. The final QRM rule will play a significant role in the expansion of successful homeownership and wealth building opportunities for communities seeking greater access to homeownership

To discuss his comments or request an interview with a CRL spokesperson on impact of the new qualified mortgage rule, please contact Catherine An at or 202-349-1878.

For more information, contact Catherine An at 202-349-1878 or