A QM Freeze in the Forecast

The CFPB announced today that it expects to propose a rule to delay the July 1, 2021 date to comply with the new Qualified Mortgage (“QM”) rule.

The CFPB’s statement provides that the extension would allow lenders more time to make QM loans based on their debt-to-income ratio (and Appendix Q), or based on the fact that they are eligible for purchase by Fannie Mae or Freddie Mac. The CFPB’s goal is to “ensure consumers have the options they need during the pandemic and the financial crisis it has caused, as well as to provide maximum flexibility to the market.”

The statement also is scheduled to appear in the Federal Register on February 26th.

Even more changes could be on the horizon. In addition to the possible delay described above, the CFPB hinted that it may revisit the Seasoned QM Final Rule, and that it will “consider at a later date” whether to initiate another rulemaking to reconsider other aspects of the General QM Rule.

One thing the CFPB did not mention in today’s statements is whether it intends to postpone the availability, scheduled for March 1, 2021, of the new General QM category, which targets loans below a certain annual percentage rate threshold.