The Ability-to-Repay (ATR) and the Qualified Mortgage (QM) rules are in effect as of January 10. It seems a little late, but yesterday a Subcommittee of the House Financial Services Committee held hearings to consider how the new rules will harm current and prospective homeowners. Representatives from the lending industry spoke about the limiting effect these rules will have on credit availability, especially on credit for low to moderate income borrowers. Committee members are considering proposed new laws to modify these rules.
Glen Corso, Managing Director of The Community Mortgage Banking Project, joined the show today and offered his “inside the beltway insights on the effects the change of control in the U.S. House of Representatives may have on the mortgage industry. According to Glen, the single biggest effect will come from Barney Frank no longer being the Chairman of the House Financial Services Committee. Barney has been such a significant influence over mortgage related legislation that without him in the Chairman position, future legislation will likely be less hands-on. Glen said to expect some technical corrections to the Dodd-Frank Bill. The corrections may be a little more than technical corrections, but far short of wholesale changes the Republicans would like. He expects little to be done about Fannie Mae and Freddie Mac now that the Republicans control the House. The two parties are very far apart in their belief about the proper course of action for Fannie and Freddie and without Democratic control of both the House and the Senate neither party is likely to succeed in pushing their plan. Glen reminded everyone that funds have already been committed to Fannie and Freddie to replenish their capital as losses continue to [...]