The CFPB requires lenders to assess the likelihood that their borrowers will be able to repay the loans they take out, a requirement known as the “Qualified Mortgage,” or QM, rule. How should this be viewed in light of the broader ongoing housing reform debate?.How has the housing finance world reacted?.What are the consequences of the expiration of the patch?.
NEW QM RULES 2021 PATCH
What made the QM Patch such bad policy?.This piece addresses some of the questions around this change in policy: Last week the Consumer Financial Protection Bureau (CFPB) announced that it would allow its special treatment of some mortgages backed by Fannie Mae and Freddie Mac, also known as the QM Patch, to expire in 2021. While allowing the QM Patch to expire will likely decrease mortgage availability, particularly for those with low incomes, it also will necessarily decrease the systemic risk implicit in the U.S.The QM Patch allows Fannie Mae and Freddie Mac to breach CFPB regulations by backing mortgages to borrowers with a higher ratio of debt to income, but the CFPB has indicated that it will allow the QM Patch to expire in 2021, eliminating this privilege.The Consumer Financial Protection Bureau (CFPB) requires that all mortgage borrowers have a debt-to-income ratio of below 43 percent (the “Qualified Mortgage,” or QM, rule), but it created an exception for mortgages backed by Fannie Mae and Freddie Mac (the QM Patch).
0 kommentar(er)
