Qualified Mortgage Timeline:
We are about to enter a new era in consumer lending, the era of the qualified mortgage. But how did we reach this point? Here’s a quick look back:
July 21, 2010 — The Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law. Among other things, the Dodd-Frank Act is designed to “promote the financial stability of the United States by improving accountability and transparency in the financial system [and] protect consumers from abusive financial services practices.”
July 21, 2011 — The Consumer Financial Protection Bureau (CFPB) begins operation. The CFPB’s creation was mandated by the Dodd-Frank Act. One of the bureau’s first tasks is to develop the final definition of a qualified mortgage, or QM.
May 31, 2012 — CFPB opens a public comment period to receive input on the new regulations.
July 9, 2012 — The comment period is closed.
July 11, 2012 – The House Subcommittee on Financial Institutions and Consumer Credit held a hearing addressing consumer and market perspectives of mortgage reforms made by The Dodd-Frank Wall Street Reform and Consumer Protection Act. Both consumer and industry members provided testimony, including the Mortgage Bankers Association and American Bankers Association. The ongoing CFPB rulemaking to implement the Dodd-Frank ability to repay rule and special status under the rule for qualified mortgages was the focus of both trade groups’ testimony
July – Dec 2012 — CFPB considers comments provided by consumers, industry groups, U.S. senators and others. Toward the end of the year, they say they are on schedule to finalize the QM rules by their January 21, 2013 deadline.
November 11, 2012 — The publishers of the Home Buying Institute launch a not-for-profit website, QualifiedMortgage.org to serve as a central source of information on QM-related subjects.
December 28, 2012 — Inside Mortgage Finance reports that “the agency’s Qualified Mortgage rule will be unveiled the evening of January 9″ 2013.
Lenders are concerned and have been discussing the proposal and what might happen. The rule will change the way many of them do business and will affect all areas of the mortgage market.
We are at a wait and see moment.