CFPB Delays QM Compliance Date; FHFA Offers Refi Option

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This week, the Consumer Financial Protection Bureau (CFPB) formally delayed the mandatory compliance date of the General Qualified Mortgage (QM) final rule from July 1, 2021 to October 1, 2022.

The CFPB is taking this action to help ensure access to responsible and affordable mortgage credit, as well as preserve flexibility for consumers affected by the COVID-19 pandemic and its economic effects.  

Delaying the mandatory compliance date of the General QM final rule allows lenders more time to offer QM loans based on the homeowners’ debt-to-income (DTI) ratio and not solely based on certain pricing thresholds.

Delaying the final rule’s compliance date would also give lenders more time to use the Government-Sponsored Enterprise (GSE) Patch, which provides QM status to loans that are eligible for sale to Fannie Mae or Freddie Mac. The availability of the GSE Patch after July 1, 2021 may be limited by recent revisions to the Preferred Stock Purchase Agreements entered into by the U.S. Treasury Department and the Federal Housing Finance Agency (FHFA).

Read the final rule here, or view the executive summary.

FHFA: New Refinance Option for Low-Income Families
In an effort to assist more than 2 million low-income families nationwide who did not take advantage of record-low interest rates on mortgages last year, the Federal Housing Finance Agency (FHFA) announced yesterday that Fannie Mae and Freddie Mac will implement a new refinance option for low-income borrowers with GSE-backed single-family mortgages.

Eligible borrowers will benefit from a reduced interest rate and lower monthly payment. FHFA estimates that borrowers who take advantage of the new refinance option could save an average of between $100 and $250 a month. Click here to see the new refinance option details, as well as qualification standards.

You can also view the fact sheet.

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