On July 25, 2019, the CFPB issued an Advance Notice of Proposed Rulemaking on the definition of a “qualified mortgage” under its ability-to-repay/qualified mortgage rule. The ANPR states that the Bureau does not intend to extend the temporary qualified mortgage (QM) classification for loans eligible to be purchased or guaranteed by Fannie Mae or Freddie Mac, which is scheduled to sunset no later than January 10, 2021. Because the majority of home purchase loans originated today fall within the temporary QM classification, expiration of the classification raises important regulatory and policy issues. We discuss these issues and will be monitoring for further developments.
Read our client alert.