As the American Bankers Association has long anticipated, CFPB Director Kathy Kraninger signaled in a letter to lawmakers last week that her agency will extend the temporary “GSE patch,” which grants Qualified Mortgage status to loans eligible to be purchased or guaranteed by Fannie Mae or Freddie Mac. The patch—which is scheduled to expire in January 2021—would be extended until an alternative rule could take effect or until one of the GSEs exits conservatorship.
Kraninger added that the CFPB intends to propose an amendment to the QM rule to move away from the use of debt-to-income ratios as a QM qualification standard, which ABA urged the bureau to do in a comment letter last fall. Kraninger said that the bureau is “working diligently” to issue a notice of proposed rulemaking “no later than May 2020.”
