MBA Advocacy Update: May 20, 2013
Sens. Joe Manchin, D-W.Va., and Mike Johanns, R-Neb., introduced legislation (S. 949) on Tuesday to amend the way "points and fees" are calculated to determine if a loan meets the Qualified Mortgage definition.
S. 949 is a companion to House legislation (H.R. 1077, the Consumer Mortgage Choice Act) that has steadily been gaining support since its introduction in March and currently enjoys the backing of nearly 30 cosponsors. Under the Consumer Financial Protection Bureau’s Ability to Repay rule, a QM cannot have points and fees exceeding three percent of the loan amount.
This MBA-supported legislation amends the Truth in Lending Act to improve upon the definitions provided for “points and fees” in connection with a mortgage transaction. It changes the calculation for determining if a mortgage loan is QM-compliant by excluding affiliated title fees as long as they are "reasonable;" and clarifying that escrows held for taxes and insurance are excluded.
To read the full Advocacy Update, click here .