A lender may rely on a written agreement between it and the GSE or Federal Agency that permits variation from the standards of the written guides and/or AUSs (so-called variances”). A “contract correspondent lender in a direct relationship with a variance holder may also rely on negotiated contract variances. A lender need not satisfy GSE or Federal Agency requirements that are unrelated” to credit “wholly risk or the underwriting of the loan, including related to the status of the creditor rather “requirements than the loan, requirements related to selling, securitizing, or delivering the loan and any requirement the creditor is required to perform after the consummated loan is sold, guaranteed, or endorsed for insurance such as document custody, quality control and servicing.” The Bureau states that requirements wholly unrelated to credit risk or the underwriting of the loan are wholly unrelated to a consumer’s ability-to-repay. The Preamble to the Amendments also states the CFPB’s view that minor inaccuracies in input data that do not affect the loan’s eligibility for purchase, guarantee or insurance should not affect its QM status, although this clarification is not expressed in the text of the amended regulation or commentary. Further, a repurchase or indemnification demand by a GSE or Federal Agency would not automatically strip a loan of its QM status because repurchase or indemnification demands are not related to eligibility “[s]ome criteria at consummation.” [New Staff Comment 43(e)(5).]
A lender may rely on a written agreement between it and the GSE or Federal Agency that permits variation from the standards of the written guides and/or AUSs (so-called “contract variances”). A correspondent lender in a direct relationship with a variance holder may also rely on negotiated contract variances. A lender need not satisfy GSE or Federal Agency requirements that are “wholly unrelated” to credit risk or the underwriting of the loan, including “requirements related to the status of the creditor rather than the loan, requirements related to selling, securitizing, or delivering the loan and any requirement the creditor is required to perform after the consummated loan is sold, guaranteed, or endorsed for insurance such as document custody, quality control and servicing.” The Bureau states that requirements wholly unrelated to credit risk or the underwriting of the loan are wholly unrelated to a consumer’s ability-to-repay. The Preamble to the Amendments also states the CFPB’s view that minor inaccuracies in input data that do not affect the loan’s eligibility for purchase, guarantee or insurance should not affect its QM status, although this clarification is not expressed in the text of the amended regulation or commentary. Further, a repurchase or indemnification demand by a GSE or Federal Agency would not automatically strip a loan of its QM status because “[s]ome repurchase or indemnification demands are not related to eligibility criteria at consummation.” [New Staff Comment 43(e)(5).]
CMG-Financial-Correspondent-Interim-ATR-and-QM-Guidance-122013.docx