The Consumer Financial Protection Bureau announced this week it is seeking further comment on its ability-to-repay mortgage rule.
The agency is working on rule making that will require lenders to assess consumers’ ability to repay mortgage loans before making them. After an initial request for comments, the CFPB has now postponed the close of the comment period until July 9, 2012.
“Through our ability-to-repay rule, we want to ensure that consumers are not set up to fail with mortgages they cannot afford and we want to protect access to affordable credit,” said CFPB Director Richard Cordray. “We are committed to gathering solid data to inform this important rule. This notice gives the public an opportunity to comment on the information we have received so far, as well as an opportunity to submit additional data.”
The ability-to-repay requirement comprises defined “qualified residential mortgages,” or “QRMs,” which do not include reverse mortgages.
The CFPB says it will use the data it has collected for different types of analysis such as determining the relationship between ability to repay and variables such as a borrower’s debt-to-income ratio.
A notice specifies the agency’s request as well as analysis and information it has received about the potential risk of litigation in connection with the new requirements.
View the notice.
Written by Elizabeth Ecker