CFPB Proposes Delay to Compliance Date for General Qualified Mortgage Amendment

The CFPB proposed a delay (from July 1, 2021 to October 1, 2022) for compliance with a December 2020 amendment to the definition of the General Qualified Mortgage ("QM") category under Regulation Z ("Truth in Lending Act").

As described in previous coverage, CFPB adopted amendments in December 2020 that replaced the 43 percent limit on a consumer's debt-to-income ratio ("DTI") with a limit based on loan pricing, providing higher thresholds for (i) smaller loan amounts, (ii) certain manufactured housing loans and (iii) subordinate-lien transactions. CFPB explained that for applications received between March 1, 2021 and October 1, 2022, creditors would have the option of complying with either the revised, price-based General QM definition or the DTI-based General QM definition.

Comments on the proposal must be received by April 5, 2021.