Home >> News >> Data >> NAMB Calls for Review of QM Rule’s Impact on Small Businesses
Print This Post Print This Post

NAMB Calls for Review of QM Rule’s Impact on Small Businesses

The ""National Association of Mortgage Brokers"":http://www.namb.org/namb/Default.asp (NAMB) is calling for a review of the ""Consumer Financial Protection Bureau's"":http://www.consumerfinance.gov/ (CFPB) new rule on ""qualified mortgages"":https://themreport.com/articles/cfpb-releases-qualified-mortgage-criteria-establishes-legal-protections-2013-01-10, saying the provisions might drive out smaller lenders.

[IMAGE]

While the association ""applauds the efforts of the Consumer Financial Protection Bureau"" in reaching out to the industry and finalizing a balanced rule, it expressed concern that the CFPB may have created ""an uneven playing field between the ├â┬ó├óÔÇÜ┬¼├ï┼ôToo Big to Fail' institutions and the thousands of small businesses originating loans today.""

NAMB specifically points to the new rule's cap on fees, which stipulates that a borrower is not to be charged more than 3 percent of the loan amount. In a release, the [COLUMN_BREAK]

association points out that the rule may promote a bias against non-creditor mortgage companies, limiting credit access for lower loan amount borrowers.

""[A]rbitrary caps on points and fees which do not impact a consumer's ability to repay, without any clear definitions, will ultimately harm consumers by reducing competition, raising borrower costs and promoting the policies of ├â┬ó├óÔÇÜ┬¼├ï┼ôToo Big to Fail' institutions,"" said John H. P. Hudson, chair of NAMB's Government Affairs Committee.

""The congressional intent of the Ability-to-Repay Rule was not to put the CFPB in a position of picking industry winners and losers,"" he continued.

The CFPB will be seeking further comment on the qualified mortgage definitions. In the meantime, NAMB is officially calling for the bureau to convene a small business review panel to study the impact the new rule will have on small business owners, their employees, and consumers in underserved areas.

""Consumers deserve protection from bad mortgage products,"" said NAMB president Don Frommeyer. ""However, the unintended consequences of ├â┬ó├óÔÇÜ┬¼├ï┼ôone size fits all' regulation will ultimately harm the very people it is meant to protect. In today's environment of historically low interest rates and an economy finally showing signs of recovery, the CFPB should continue to work with the mortgage industry to ensure that consumers still have availability to affordable credit.""

x

Check Also

Survey: Homeownership Remains Elusive for Baby Boomer Renters

A recent look into housing affordability by NeighborWorks America has found that three in five long-term baby boomer renters feel homeownership remains unattainable.