It appears likely that the ability-to-repay/qualified mortgage rule by the CFFB will not occur after the November elections. The bill
will require all creditors to determine a consumer’s ability to repay a mortgage before making a loan. The rule would “prohibit creditors from making a mortgage loan without considering and verifying the consumer’s ability to repay the loan, establish a “Qualified Mortgage” category that would set forth standards for a safe harbor or a presumption of compliance, establish new restrictions on prepayment penalties, provide for a special balloon mortgage “qualified mortgage” exemption for rural or underserved areas, and special provisions to permit the refinance of mortgages with risky features into more stable standard mortgages with lower monthly payments.”’ It would apply to all consumer mortgages except home equity lines of credit, timeshare plans, reverse mortgages, or temporary loans. The Bureau is attempting to reshape mortgage lending after the poor underwriting that led to the housing crash triggering the financial crisis. Banks are opposing many of the proposals because it will make it more difficult for them to extend loans.