WASHINGTON (4/24/14)--The Consumer Financial Protection Bureau is expected to ease its rules setting fees for Qualified Mortgage loans, as defined under the bureau's Ability-to-Repay rules, American Banker reported Wednesday.
The article quoted Leonard Chanin, a partner at Morrison & Forester who is the former head of regulation at the CFPB.
The existing CFPB rule on QM fees paid to affiliates are restricted to 3% of the loan amount, and that must include points. Chanin told American Banker that he has heard from unofficial sources that the agency is working to clarify the ATR rule.
He said addressing fees passed through an affiliate would be an area that would be relatively easy to fix or clarify. The article said that Richard Andreano, an attorney at Ballard Spahr, agreed with Chanin's assessment, adding that he expects the CFPB to address the issue when it releases technical changes this spring.
The Credit Union National Association has noted the QM rule's 3% limitation on points and fees for a qualified mortgage loan may be problematic for some credit unions, and has also said the rule's total debt-to-total-monthly-income ratio of 43% should be expanded.
As CUNA Deputy General Counsel Mary Dunn told Bloomberg Business News Americas back in December, there are many creditworthy borrowers with debt-to-income ratios that exceed the limits proposed in the QM regulations. "You can still demonstrate an ability to repay a loan, but have a debt-to-income ratio that is higher than 43%," Dunn said.