Confused on the Ability to Repay (ATR)/Qualified Mortgage (QM) Rule and its impact on the Higher-Priced Mortgage 
Loan (HPML) requirements? Remember that some QM’s have special rate thresholds:
A Small Creditor Portfolio QM or Balloon Payment QM isn’t a higher-priced covered transaction (HPCT) unless it exceeds the Average Prime Offer Rate (APOR) by 3.5% or more, first liens included. This means, rather than having a safe harbor for compliance, you have a rebuttable presumption of compliance. However, first-lien Small Creditor Portfolio QMs and Balloon-Payment QMs with an APOR rate spread of 1.5 or more must still follow the HPML escrow requirements, (unless you’re exempt from them). While QMs are exempt from the HPML appraisal requirements, don’t forget about the Regulation B appraisal requirements! And don’t forget, if you have a non-QM HPCT, you must consider any balloon payment in the repayment analysis, regardless of when it occurs.
Still confused? Join us for our Ability to Repay (ATR), Qualified Mortgage (QM), High Cost Mortgage (HCM) and Higher-Priced Mortgage Loan (HPML) webinar on April 26, 2017. We will dive right into the What, Where, When and How with plain English instruction and answers.
Published
2017/04/19
Deb Irving
Deb joined Banker’s Compliance Consulting with twenty years of experience in the banking industry. Her past positions include teller, credit review analyst, assistant financial officer, BSA Officer, Compliance Officer, and Director of Compliance. She has worked for both a small community bank and a large billion-dollar bank.
Deb has Associate Degrees in Business Management and Accounting. She is a graduate of the American Bankers Association National Graduate School of Compliance Management, an honors graduate of Schools of Banking Compliance School, and a graduate of Schools of Banking Advanced School of Banking. Deb’s considerable knowledge and experience make her a valuable member of the Banker’s Compliance Consulting Team. Deb is a Certified Regulatory Compliance Manager (CRCM) and a Certified Anti Money-Laundering Specialist (CAMS).
Deb loves to spend her free time cycling, running, kayaking and weight lifting with her husband. Between them, they have three adult children and six grandchildren. Other interests include anything outdoors and anything she hasn’t done or seen yet!