CFPB Director Richard Cordray told Realtors on Tuesday credit unions will continue to offer mortgages that don’t conform to the CFPB’s qualified mortgage rule that takes effect on Friday.
“Qualified mortgages cover the vast majority of loans made in today’s market, but they are by no means all of the mortgage market. This point is quite important, and it should not be misunderstood. These lenders, including many of our community banks and credit unions, have seen the strong performance of their loans over time,” Cordray said on Tuesday before the National Association of Realtors in Washington.
“Nothing about their traditional lending model has changed, and they should continue to offer such mortgages to borrowers whom they evaluate as posing reasonable credit risk – whether or not they meet the criteria to be classified as Qualified Mortgages,” he added.
Cordray stressed that the bureau’s rule lays out specific criteria for QMs.
“Lenders can choose not to follow these guidelines and simply make a loan based on their reasonable, good-faith determination that the consumer is able to repay it. But either way, they cannot trap consumers in loans that the lenders should recognize are unaffordable,” he said.
The CFPB director also urged Realtors to promote the CFPB’s online complaint system.
“Make sure they know they can submit consumer complaints about problems they are experiencing with mortgages, credit cards, student loans, auto loans, and bank accounts,” he said.
The CFPB released new resources on Tuesday designed to educate the public about new protections under the CFPB’s mortgage rules. The CFPB provided templates consumers can use to write a letter to their loan servicer to request more information or correct an error.