CFPB Delays Mandatory Compliance Date of General QM Final Rule to Oct. 1, 2022

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On April 30, 2021, the Consumer Financial Protection Bureau (CFPB) published in the Federal Register a final rule (April 2021 final rule) amending the Ability-to-Repay/Qualified Mortgage Rule (ATR/QM Rule) in Regulation Z.

With some exceptions, Regulation Z requires lenders to make a reasonable, good-faith determination of a consumer’s ability to repay any residential mortgage loan. Loans that meet Regulation Z requirements for qualified mortgages obtain certain protections from liability. Regulation Z contains several categories of QMs, including the General QM category and the Temporary Government-Sponsored Enterprise (GSE) QM category. This final rule affects two categories of QMs:

  • General QMs: Extends the mandatory compliance date of General QM loans from July 1, 2021, to Oct. 1, 2022, to preserve flexibility for consumers, particularly those affected by the COVID-19 pandemic. The final rule does not make other changes to the General QM loan definition.
  • Temporary GSE QMs: Extends the termination date of new GSE QMs to Oct. 1, 2022, or when the applicable GSE exits federal conservatorship, if that happens earlier. The provision that created this loan category is commonly known as the GSE Patch.

Click here to read the Regulatory Alert.

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