Reading between the lines on the CFPB final QM rule
Leaders of the Mortgage Bankers Association did not elaborate on how the Consumer Financial Protection Bureau will ultimately draft the final qualified mortgage rule under the Dodd-Frank Act.
But the possibility of a safe harbor seems more possible each day, with MBA leadership suggesting the CFPB is taking feedback from the market seriously.
If you had listened to MBA CEO David Stevens and Debra Still, the trade group's 2013 chairman, discuss CFPB policymaking Monday, you would have left with the distinct impression that a dose of optimism is in the air about how seriously the CFPB is taking feedback from the industry on the QM rule.
This doesn't mean the industry will get the safe-harbor provision to the qualified mortgage that it's hoping for, but it could mean the MBA believes it is being heard on the issue.
Overall, Stevens and Still seemed less skeptical in a meeting with reporters when discussing the CFPB's rulemaking process in relation to QM as compared to other processes used by federal housing agencies.
"Fannie and Freddie policies should go through a proposed rulemaking and comment period," Stevens said in a briefing with reporters.
He added that the CFPB uses a very detailed policy proposal and feedback format that "lets everyone get engaged and it (the rule) comes out better. And, hopefullly, you will see that with the CFPB qualified mortgage rule."
Reading between the lines, neither Stevens nor Still claim to know how the final rule will be defined, but they do seem to express confidence in that they're being heard at the CFPB.
On the other hand, Stevens suggested rules from the Federal Housing Finance Agency in regard to the government-sponsored enterprises are coming out too fast and furious without enough detail early on.
"How about making the Federal Housing Finance Agency — FHFA — comply with public notice and comment rules before the GSEs impose critical new rules on our industry," Stevens said in prepared remarks. He added, "Even though Fannie and Freddie are regulator and government sponsored — their rules are set without benefit of the process followed by all other government agencies."
When asked about comment periods that the FHFA has allowed on issues in the past, Steven said what is needed is the release of "clear, detailed policy statements."
He pointed to the CFPB's handling of rules as an example of policies that are at least being phased in over time with clear detailed plans and a chance for substantive feedback.
Both Stevens and Still emphasized the MBA's current push to coordinate heavily with policymakers and lawmakers on both sides of the aisle to ensure rules do not conflict or have adverse consequences for homebuyers.
"The bottom line is if there is conflict in rulemaking and policy, it’s the consumer who will ultimately be negatively impacted and credit will be tighter," Still said in a morning press briefing.