Changes to the Qualified Mortgage Rule Are Coming; Be Prepared
Changes to the Qualified Mortgage Rule Are Coming; Be Prepared With origination volumes skyrocketing due to historically low interest rates, it would be an understatement to say lenders have been preoccupied in 2020. However, as the Consumer Financial Protection Bureau considers changes to the qualified mortgage rule, lenders must shift a portion of their focus to ensure they understand the proposed changes and are prepared to comply once the rule becomes final. The CFPB's proposals would eliminate the much-reviled Appendix Q and clarify several factors currently used to assess a borrower's ability to repay — including the consumer's current or reasonably expected income or assets and current debt obligations, alimony, and child support— and offer a path for loans to achieve safe harbor status over time. As with any regulatory change, the proposals offer cause for celebration and concern. For example, many lenders will applaud the elimination of Appendix Q, which is