WASHINGTON, D.C. – May 22, 2013 – (RealEstateRama) — Members of the Financial Institutions and Consumer Credit Subcommittee expressed concerns at a hearing today that the Qualified Mortgage rule mandated by the Dodd-Frank Act will reduce access to credit that qualified borrowers need to buy homes.
Banks and credit unions have already pulled back on extending mortgage credit and have tightened underwriting standards in response to the financial crisis. The Qualified Mortgage (QM) rule may well exacerbate this reduction in access to credit.
“My main concern with the QM rule is that the people who do not fit the one-size-fits all criteria for QM loans will not be able to access mortgage credit,” said Subcommittee Chairman Shelley Moore Capito (R-WV). “Despite the CFPB’s claims that lenders will issue non-QM mortgages, my conversations with lenders lead me to believe that few, if any, will be willing to issue these types of mortgages,” Capito added.
The CFPB – the Consumer Financial Protection Bureau – was represented at today’s hearing by two witnesses. The CFPB has responsibility for finalizing the Qualified Mortgage rule.