Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
CUNA Seeks CU Comment On HUD QM Definition
WASHINGTON (10/5/13)--What factors should the U.S. Department of Housing and Urban Development (HUD) take into consideration as it sets points and fees limits for its pending qualified mortgage (QM) definition? Credit unions can take on this and other questions in a new Credit Union National Association comment call.

HUD is required under the Dodd-Frank Act to issue its own qualified mortgage rule, separate from the one issued earlier this year by the Consumer Financial Protection Bureau (CFPB). Once finalized, HUD's WM rule will replace the CFPB's QM definition for Federal Housing Administration (FHA) loans or certain other HUD insured loans. HUD expects to finalize and have its QM rule become effective on Jan. 10, at the same time as the CFPB's QM rule takes effect.

The HUD definition would be similar to the CFPB definition, with some distinct differences. For instance, HUD's proposed rule does not have a debt-to-income ratio requirement.

HUD's proposed rule would:
  • Require FHA streamlined refinances to comply with the rule;
  • Modify the CFPB's rebuttable presumption standard to clarify that a presumption is rebutted if the lender does not meet the underwriting requirements applicable to the transaction;
  • Maintain the existing regulatory structure for FHA-insured single-family mortgage programs for purposes of defining qualified mortgages, but augment these programs with certain features;
  • Define all FHA-insured single-family mortgages to be qualified mortgages, except reverse mortgages insured under HUD's Home Equity Conversion Mortgage (HECM) program; and
  • Incorporate safe harbor and rebuttable presumption standards into its own definition of qualified mortgage.
HUD is seeking comment from lenders participating in its programs on any issues specific to HUD's mortgage insurance and loan guarantee programs. Many of these issues are addressed in the CUNA comment call.

Other topics addressed in the comment call include:
  • Whether lenders participating in HUD's mortgage insurance and loan guarantee programs would lower the annual percentage rate relative to the average prime offer rate; and
  • Whether lenders would always opt for the safe harbor QM rule, and never make a rebuttable presumption QM, and what views credit unions have on the effect that this incentive may have on lenders, borrowers and the broader economy.
CUNA is accepting comments until Oct. 15. Comments are due to HUD by Oct. 30.
For the full comment call, use the resource link.
Other Resources

Comment Call
RSS print
News Now LiveWire
July 's Fed Bank's "FedFocus" has some interesting articles: incl cost/benefits of $1 currency 2 coin conversion ttp://tinyurl.com/nybmnhh
3 hours ago
Do you wish you were a News Now subscriber? Go here: http://t.co/7evfBSjeMx
3 hours ago
Financial education for student body key part of Altura #creditunion, UC-Riverside partnership #NewsNow http://t.co/Xp6OJd66o6
4 hours ago
.@VTcreditunions gains 200 new FB followers in just 2 wks to reach 1,000 http://t.co/I89xJcv4Jg
4 hours ago
.@CUNA is testifying on reg relief Tues,July 15 at 2 p.m. be4 Hs Fin Serv Subc. Here is the agenda and witness list: http://t.co/yBRhlmdqHt
7 hours ago