CFPB Delays Mandatory Compliance Date for General QM Rule
The Consumer Financial Protection Bureau (CFPB) has formally delayed the mandatory compliance date of the General Qualified Mortgage (QM) final rule from July 1, 2021, to Oct. 1, 2022.
The agency said in a press release that it is taking this action “to help ensure access to responsible, affordable mortgage credit, and preserve flexibility for consumers affected by the COVID-19 pandemic and its economic effects.”
The General QM final rule would replace the current requirement for General QM loans that the consumer’s debt-to-income ratio (DTI) not exceed 43%, with a limit based on the loan’s pricing.
In adopting a price-based approach to replace the specific DTI limit for General QM loans, the CFPB determined that a loan’s price is a strong indicator of a consumer’s ability to repay and is a more holistic and flexible measure of a consumer’s ability to repay than DTI alone. A loan meets the general QM definition if its annual percentage rate exceeds the average prime offer rate (APOR) for a comparable transaction by less than 2.25 percentage points.
In addition, the General QM final rule:
- Provides higher pricing thresholds for loans with smaller loan amounts, for certain manufactured housing loans, and for subordinate-lien transactions.
- Retains the General QM loan definition’s existing product-feature and underwriting requirements and limits on points and fees.
- Requires lenders to consider a consumer’s DTI ratio or residual income, income or assets other than the value of the dwelling, and debts, and removes appendix Q and provides more flexible options for creditors to verify the consumer’s income or assets other than the value of the dwelling and the consumer’s debts for QM loans.
QM loans are presumed to be made based on the lender’s reasonable determination of the home owner’s ability to repay the loan.
Latest from NAHBNow
May 13, 2025
What Are the Highest Paying Jobs in Construction?Half of payroll workers in construction earn more than $60,320, compared to the U.S. median annual pay of $49,500, and the top 25% make at least $81,510, according to the latest May 2024 Bureau of Labor Statistics Occupational Employment and Wage Statistics (OEWS) and analysis by NAHB. See which occupations in the construction are the highest earning.
May 12, 2025
Statement from NAHB Chairman Buddy Hughes on U.S.-China Tariff AgreementBuddy Hughes, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Lexington, N.C., issued a statement after the U.S. and China announced a 90-day pause on most of the tariffs each nation has imposed on one another.
Latest Economic News
May 13, 2025
Inflation Eased Again in AprilInflation slowed to a 4-year low in April while shelter inflation remained elevated. Despite the easing, inflation may pick up in the coming months as possible inflationary pressure from enacted tariffs and other policy uncertainties continues to threaten economic growth and complicate the Fed’s path to its 2% target.
May 13, 2025
Residential Mortgages Experience Weaker Demand in First QuarterOverall demand for residential mortgages was weaker while lending standards for most types of residential mortgages were essentially unchanged according to the Federal Reserve Board’s April 2025 Senior Loan Officer Opinion Survey (SLOOS).
May 13, 2025
Highest Paid Occupations in Construction in 2024Half of payroll workers in construction earn more than $60,320 and the top 25% make at least $81,510, according to the latest May 2024 Bureau of Labor Statistics Occupational Employment and Wage Statistics (OEWS) and analysis by the National Association of Home Builders (NAHB). In comparison, the U.S. median annual pay is $49,500, while the top quartile (the highest paid 25%) makes at least $78,810.