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CMLA Responds to the "Ability to Pay" rule and Qualified Mortgage (QM) Legislation

Published: July 28,2011

CMLA has responded to the Qualified Mortgage (QM) legislation that was recently introduced. Below is a summary from the comment letter CMLA sent to regulators.

Click Here to View CMLA's QM Comment Letter

The Colorado Mortgage Lenders Association strongly urges the Board to adopt a bright line safe harbor definition of the Qualified Mortgage with the following modifications:

  • Exclude loan officer compensation paid to the originator by a creditor, lender or mortgage broker from the 3 point cap on points and fees;
  • Increase the small loan definition to $100,000 with a corresponding adjustment to the 3.5 to 5 point scale;
  • Exclude fees paid to affiliates for settlement services so long as those fees do not exceed fees filed with the appropriate regulatory agencies or an average of such settlement fees for the market in which the loan origination takes place; and
  • Exclude gain or loss on the sale of the loan in the secondary market from the calculation of points and fees for the 3 point cap.