New CFPB Mortgage Rules Take Effect in January: Year in Review
- All QMs must include points and fees less than or equal to 3% of the loan amount.
- Maximum loan term has to be less than or equal to 30 years.
- Federal regulators do not anticipate that a creditor’s decision to offer only Qualified Mortgages would, absent other factors, elevate a supervised institution’s fair lending risk.
In October, the NCUA, the CFPB and three other federal regulators responded to creditor concerns over liability under the Equal Credit Opportunity Act for offering only qualified mortgages, as defined by the CFPB’s Ability-to-Repay Rule.
The rule implements parts of the Dodd-Frank Act that require creditors to make a reasonable determination that a consumer is able to repay a mortgage loan before issuing credit.
In the letter, Sen. Mark Begich (D-Alaska) and 25 Republicans said compliance with the rules before the deadline is a daunting task for credit unions and community banks.
“These proposed new rules and amendments present our nation’s financial institutions with thousands of pages of new regulations with which they must comply by January 2014,” said the letter dated Nov. 21, just before the Thanksgiving congressional recess.