twitter linkedin
facebook google+
Search:

Mortgage News

News by Subject
Complete list of specialty news sections.

Purchase Subscription
Subscribe to MortgageDaily.com and get immediate access to all news, statistics and archives.

Mortgage Advertising
Reach mortgage executives, loan originators and other people tied to mortgage industry.

Consumer Mortgage News
Free mortgage news for prospective borrowers.

Mortgage Newsletter
Free e-mail newsletter with the latest headlines from MortgageDaily.com.

Mortgage News Reprints
Put entire MortgageDaily.com stories in your online or printed newsletter or publication.

Mortgage Feedget RSS code
Condensed MortgageDaily.com stories free on your Web site or for your RSS reader.

News Archives
Archive of MortgageDaily.com stories by month going back to 1999.

Press Releases
Reports and announcements from MortgageDaily.com.

Mortgage Statistics
Data and statistics for real estate finance.

Mortgage Directories
Directories of lenders, branch operators and mortgage service providers.

Mortgage Graphs
Directories of lenders, branch operators and mortgage service providers.

home subscribe advertise reprints e-mail help RSS about us LOG IN

Mortgage News

 

Mortgage News

HOT Topics

production

servicing

compliance

legal

fraud

secondary

jobs

appraisal

site map

www.loan-academy.com/
Mortgage Compliance News | Mortgage Compliance Newsletter | Mortgage Regulations
News about complying with mortgage laws, rules and regulations.


Regulators Address QM Disparate Lending Concerns

Federal regulators issue interagency statement

Oct. 22, 2013

By Mortgage Daily staff

Concerns about whether mortgage lenders would be liable for discriminatory lending because they originate Qualified Mortgages were addressed by federal regulators.

An interagency statement was issued Tuesday by financial regulators about disparate impact liability for lenders that issue only QMs.

The statement was jointly released by the Consumer Financial Protection Bureau, Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corp., National Credit Union Administration and Office Comptroller of the Currency.

According to the statement, creditors have been inquiring about if they would be liable under the disparate impact doctrine of the Equal Credit Opportunity Act and Regulation B, which implements ECOA, if they originate only QMs as defined by the CFPB's Ability-to-Repay and Qualified Mortgage Standards Rule.

The recently issued rule, which implements provisions of the Truth in Lending Act, takes effect in January.

According to the statement, the regulators view the requirements of the Ability-to-Repay Rule and ECOA as compatible.

"ECOA and Regulation B promote creditors acting on the basis of their legitimate business needs," the statement said. "Viewed in this context, and for the reasons described below, the agencies do not anticipate that a creditor's decision to offer only Qualified Mortgages would, absent other factors, elevate a supervised institution's fair lending risk."

The regulators noted that there are several ways to satisfy the Ability-to-Repay Rule.

This includes making responsibly underwritten loans that are not QMs. The CFPB acknowledged that it is not possible to define by rule each instance when a home loan is affordable for the borrower.

But still, creditors might choose to predominantly originate QMs when the Ability-to-Repay Rule first takes effect, and the rule includes transition mechanisms that will preserve access to credit during the transition period.

Regulators expect creditors to consider demonstrable factors that may include credit risk, secondary market opportunities, capital requirements and liability risk -- and the new rule doesn't dictate how they balance these factors.

"As creditors assess their business models, the agencies understand that implementation of the Ability-to-Repay Rule, other Dodd-Frank Act regulations, and other changes in economic and mortgage market conditions have real world impacts and that creditors may have a legitimate business need to fine-tune their product offerings over the next few years in response," the statement said.

The regulators noted that creditors might find that loans currently eligible for sale on the secondary market are already QMs under the transition provision, which gives QM status to most agency loans.

As far as fair lending concerns go, the regulators suggest that the current situation is similar to historical challenges to developing product offerings .

"Some creditors, for example, decided not to offer 'higher-priced mortgage loans' after July 2008, following the adoption of various rules regulating these loans or previously decided not to offer loans subject to the Home Ownership and Equity Protection Act after regulations to implement that statute were first adopted in 1995," the statement said. "We are unaware of any ECOA or Regulation B challenges to those decisions."

The regulators said that lenders should continue to evaluate fair lending risks in the same manner they would for other product offerings. They should carefully monitor their policies and practices and implement effective compliance systems.

next story

back to current headlines


Secondary Marketing News | Correspondent Lender Directory
Mortgage portfolio trades and forward commitments. Correspondent lending, r e p u r c h a s e s and warehouse news. Secondary marketing statistics and lawsuits.



Predatory Lending News
FTC and HUD settlements. Class action lawsuits. Predatory lending prevention. Archives back to 2001.




Financial Regulation News | Mortgage Regulations
Bank and mortgage regulators, regulations and regulatory actions. Coverage of regulatory legislation and testimony.

www.mortgagebranchmanagerjobs.com
Logout forgot
password?

SUBSCRIBERS: Edit Subscription | Subscription Help | or call 214.521.1300

Subscribe Contact Us Site Map

Copyright © 2017 Mortgage Daily, D a l l a s
Subsribers Only:

AMC directory

ARM indexes

mortgage company directory

mortgage regulations

net branch directory

p r i c i n g engine directory

wholesale lender directory

More Mortgage News Resources (full site map):

advertising news

appraisal news

bank news

biggest lenders

commercial mortgage news

corporate mortgage news

credit news

FHA news

financial regulation news

foreclosure news

GSE news

jumbo mortgage news

interest rates

loan modification news

loan originator survey

LOS Newsletter

MBS

mortgage associations

mortgage-backed securities

mortgage books

mortgage brokers

mortgage compliance

mortgage conferences

mortgage directories

mortgage education

mortgage employment

mortgage employment index

mortgage executives

mortgage fraud

mortgage fraud blog

mortgage fraud local news

Mortgage Fraud Index

Mortgage Graveyard

mortgage insurance news

mortgage lawsuits

mortgage leads

mortgage lender ranking

mortgage licenses

mortgage litigation

Mortgage Litigation Index

Mortgage Market Index

mortgage mergers

mortgage news

mortgage politics

mortgage press releases

mortgage production

mortgage public relations

mortgage rates

mortgage servicing

mortgage statistics

mortgage technology

mortgage video

mortgage Webinars

net branch

net branch directory

nonprime news

origination news

originator tools

real estate news

refinance news

reverse mortgage news

secondary marketing

social media

servicing news

subprime news

wholesale lenders