As a mortgage broker, chances are you are intimately knowledgeable about the Appraisal Independence Requirement AIR as part of sound underwriting for financial institutions. And though you may be familiar with the provisions for gaining information to safely loan on a property, be careful not to take for granted that buyers are aware of the legislation or the purpose and process of the appraisal overall.
The CFPB released over 1,300 pages of documents today including the 804 page Qualified Mortgage Rule, also known as the Ability to Repay. Read the CFPB rule here.
In short, the QM will abolish loans with “risky features” such as no doc loans and pay-option ARMs as will as implement a max 43% back end ratio for non-GSE, non-FHA, non-VA, non-USDA loans at this time.
The QM also includes a cap on “points and fees” of 3% which will include LO compensation and affiliated fees.
The Rule is effective January 10, 2014.
The CFPB is seeking comment on how exactly the LO compensation piece will work. NAMB looks forward to working with the CFPB to work on the details.
NAMB officially is requesting the CFPB to convene a SBREFA Panel to specifically discuss the impact the rule will have on not only small business mortgage professionals, but the consumers they serve. Read the NAMB Press Release.
Copy of NAMB’s testimony to the House Financial Services Committee from July which spells out the concerns with the 3% cap on points and fees can be found here.
Bottom Line: Don’t Panic!…yet. Your Government Affairs team at NAMB is already hard at work. We represented mortgage professionals at the CFPB hearing in Balimore today and are already working with other trade associations to determine the best course of action with the new rules. Stay tuned and support those thaty support you!
2013 NAMB Legislative and Regulatory Conference will be March 10, 11, 12 in Washington, D.C.. This is a “must attend” event. Last year, 10,000 Realtors attended NAR’s Lobby Day. We would love to see if we can get 1,000 mortgage professionals there to help us lobby on Capital Hill. Join us as we rally to fight for consumers, small business and mortgage professionals everywhere. Stay tuned for more details!!!
NAMB Government Affairs Committee meeting this week. If you would like to volunteer and participate with your GA Team, please let me know at email@example.com
We need your participation and support…get involved today. NAMB is a non-profit trade association made up of volunteers that are passionate about the preservation and promotion of consumer choice, small business, and the well-being of ALL mortgage industry professionals. We have been fighting for the mortgage industry since 1973….Join us in our efforts. Support YOUR Industry, Fight Back, Join NAMB Here
SUPPORT NAMBPAC – As we vigorously fight for you in Washington, we do need help supporting those legislators that support us – please visit NAMBPAC to learn more!
Mortgage companies that own title companies are worried that the qualified mortgage rule the Consumer Financial Protection Bureau is slated to unveil Thursday will penalize the use of affiliated service providers.
The Senate debate over the confirmation of a Federal Housing Administration commissioner has revealed a divide between some Republican lawmakers over the reason the FHA mortgage insurance fund is in the red.