Wednesday, June 19, 2013

Do QM Requirements Limit Consumer Options?

During House Financial Services Committee testimony on June 18, the National Association of REALTORS® called on Congress to revise the Qualified Mortgage requirements that limit consumer choice.

In a testimony before the House, NAR president Gary Thomas implored Congress to revisit the definition of fees and points applied to affiliated mortgage lenders that require the counting of title company charges, the amount of homeowner’s insurance held in escrow, loan level price adjustments, and payments made by lenders in wholesale transactions towards the 3 percent cap in the QM rule.

Another area of concern about QM underwriting standards is the 43 percent debt-to-income limit on jumbo and non-government backed loans. In high cost areas where high-income borrowers obtain jumbo financing, this could be particularly problematic. Greater flexibility with regard to DTI limits is preferable so that credit is not restrained in high cost communities.

Source: National Association of REALTORS®

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