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Monday, June 4, 2012

ABA Shares Mortgage Data with CFPB to Help Define QM

ABA last week sent the CFPB official survey data it has gathered on mortgage loans -- from banks of all sizes below $60 billion in assets -- to help the CFPB define the “qualified mortgage” -- or QM -- designation in its pending ability-to-repay final rule.

ABA emphasized that it is important to know what portion of mortgage loans currently being made under today’s underwriting standards might be excluded by imposing specific ratios in the QM definition.

ABA has urged the CFPB to adopt a QM definition that is sufficiently broad to cover most lending being done under current underwriting standards. "ABA strongly suggests that the survey data be analyzed to measure all the credit restrictions likely to be imposed by arbitrary imposition of numerical thresholds," the association wrote in an e-mail.

ABA intends to collect and share with the CFPB data from the largest bank lenders to confirm that lending experiences at the largest banks are consistent with that for banks of $60 billion and less.

We recently posted on the CFPB’s requested for additional comments on new data and information it has received in its rulemaking to require lenders to assess consumers’ ability to repay mortgage loans before extending credit. Comments are due on July 9, 2012.

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