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CRL to Regulators: Align Qualified Mortgage (QM) and Qualified Residential Mortgage (QRM) Rules

June 28, 2013
Mortgage Lending

Dodd-Frank Financial Reform charged the Consumer Financial Protection Bureau (CFPB) to set basic mortgage definitions that would be easily understood by lenders and borrowers alike. In January 2013, CFPB issued the Qualified Mortgage (QM) rule that requires full documentation, the elimination of risky mortgage terms and limits up-front fees to no more than three points on 30 year mortgages.

Now, as other regulators move to define Qualified Residential Mortgages (QRMs), CRL urges for the two rules to use the same standards. In this issue brief, CRL warns that different standards would create too many complex restrictions. CRL also urges that regulators exclude down payment requirements from the QRM definition. Low down payment loans with responsible loan terms and underwriting, says CRL, are proven to ways to successfully expand homeownership.