Alert May 01, 2012

Industry Urges “Safe Harbor” for Lenders in Qualified Mortgage Rule

In a letter to the CFPB, mortgage industry groups urged it to structure the qualified mortgage rule in its forthcoming ability to repay regulation as a “legal safe harbor with clear, well-defined standards.”  In particular, the industry called for standards that specify the grounds on which there can be litigation or enforcement action as to whether the requirements for a “qualified mortgage” have been met. The industry further argued that structuring the qualified mortgage rule as a safe harbor, as opposed to a rebuttable presumption, would “markedly lessen the availability and affordability of sustainable mortgages to consumers,” reduce litigation and allow lenders to “comfortably operate within the boundaries” established by the rule. Click here for the letter.