Public Statement on General QM and Seasoned QM Final Rules

AGENCY:

Bureau of Consumer Financial Protection.

ACTION:

Public statement; status of published final rules.

SUMMARY:

The Bureau of Consumer Financial Protection (Bureau) has released a public statement regarding the mandatory compliance date of the Bureau's General QM Final Rule and possible reconsideration of the General QM Final Rule and the Seasoned QM Final Rule.

DATES:

The public statement was released on the Bureau's website on February 23, 2021.

FOR FURTHER INFORMATION CONTACT:

Ben Cady, Mark Morelli, Amanda Quester, or Jane Raso, Senior Counsels, Office of Regulations, at 202-435-7700. If you require this document in an alternative electronic format, please contact CFPB_Accessibility@cfpb.gov.

SUPPLEMENTARY INFORMATION:

On December 10, 2020, the Bureau issued two final rules relating to the qualified mortgage (QM) definition under the Truth in Lending Act: A final rule entitled “Qualified Mortgage Definition under the Truth in Lending Act (Regulation Z): General QM Loan Definition” (General QM Final Rule) and a final rule entitled “Qualified Mortgage Definition under the Truth in Lending Act (Regulation Z): Seasoned QM Loan Definition” (Seasoned QM Final Rule). March 1, 2021, is the effective date of both the General QM Final Rule and the Seasoned QM Final Rule. The Bureau also established a mandatory compliance date for the General QM Final Rule of July 1, 2021.

Another category of QMs currently available under Regulation Z consists of loans that are eligible for purchase or guarantee by either the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation (collectively, the GSEs), while operating under the conservatorship or receivership of the Federal Housing Finance Agency (FHFA) (Temporary GSE QM loan definition). Pursuant to a final rule issued on October 20, 2020, the Temporary GSE QM loan definition is scheduled to expire on (1) the mandatory compliance date of the General QM Final Rule or (2) with respect to each GSE when that GSE ceases to operate under the conservatorship of FHFA, whichever happens earlier.

The Bureau is considering whether to initiate a rulemaking to revisit the Seasoned QM Final Rule. If the Bureau decides to do so, it expects that it will consider in that rulemaking whether any potential final rule revoking or amending the Seasoned QM Final Rule should affect covered transactions for which an application was received during the period from March 1, 2021, until the effective date of such a final rule.

The Bureau also expects to issue shortly a proposed rule that would delay the July 1, 2021 mandatory compliance date of the General QM Final Rule. If such a proposed rule were finalized, creditors would be able to use either the current General QM loan definition or the revised General QM loan definition for applications received during the period from March 1, 2021, until the delayed mandatory compliance date. Furthermore, the Bureau anticipates that the Temporary GSE QM loan definition will remain in effect until the new mandatory compliance date, in accordance with the October 20, 2020 final rule described above, except that the Temporary GSE QM loan definition would expire with respect to a GSE if that GSE ceases to operate under conservatorship prior to the new mandatory compliance date.

The Bureau will consider at a later date whether to initiate another rulemaking to reconsider other aspects of the General QM Final Rule.