NAMB Joins Coalition Submitting CFPB Petition on QM Rule

The ""National Association of Mortgage Brokers (NAMB)"":http://www.namb.org/ has joined the coalition of professional entities petitioning the ""Consumer Financial Protection Bureau (CFPB)"":http://www.consumerfinance.gov/ for greater clarification of the Qualified Mortgage (QM) rules within the Dodd-Frank Act.

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Comprised of various trade associations and housing interest groups with ties to the mortgage industry, the coalition recently submitted a letter to CFPB director Richard Cordray.

Specifically, the document to the CFPB addresses concerns over the implementation of the borrower's ability-to-repay portion of the QM regulations. According to the coalition, a very narrow

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QM rule could result in higher rates and fees for borrowers, as well as less access to credit for potential homebuyers.

""NAMB supports a broader QM definition that establishes strong consumer protections while promoting mortgage liquidly and affordability to the consumer seeking mortgage financing,"" said Donald J. Frommeyer, president of NAMB. ""We need to be careful when defining a borrower's 'ability-to-repay.'""

As it stands now, QM legislation could be especially damaging to low- to moderate-income buyers. Citing the law's three percent cap and fees rule, the coalition stated that such a rule will most dramatically affect those purchasing homes and loans of lesser amounts.

""Our primary concern is for the overall health of the national economy,"" said John H. P. Hudson, government affairs committee chairman of NAMB. ""If the 'qualified mortgage' is too narrowly defined with items that really do not measure a consumer's ability-to-repay, then consumers will simply not have access to credit which will further perpetuate the economic woes this country faces. Imagine what the economy would look like if the nation's auto manufacturers lost the ability to finance their products? There are better ways to measure a consumer's ability-to-repay, such as residual income requirements.""