The Consumer Financial Protection Bureau released a fact sheet on the interest rate used to calculate prepaid interest for qualified mortgages under the price-based General QM definition.
CFPB issues QM fact sheet on certain adjustable-rate loans
February 24, 2022 / By ICBA
The Consumer Financial Protection Bureau released a fact sheet on the interest rate used to calculate prepaid interest for qualified mortgages under the price-based General QM definition.
The Consumer Financial Protection Bureau released a fact sheet on the interest rate used to calculate prepaid interest for qualified mortgages under the price-based General QM definition.
Background: The fact sheet addresses how to calculate the annual percentage rate for “short-reset” adjustable-rate mortgages and step-rate loans, in which the interest rate changes within five years of the date on which the first regular periodic payment is due.
Details: According to the fact sheet, creditors must treat the maximum interest rate that may apply during that five-year period as the interest rate for the full term of the loan when determining the APR for the price-based QM definition.
More: This special rule also applies for the purpose of determining whether the loan receives a conclusive or a rebuttable presumption of compliance with the ability-to-repay requirement.
Subscribe now
Sign up for the Independent Banker newsletter to receive twice-monthly emails about new issues and must-read content you might have missed.
Sponsored Content
Featured Webinars
Join ICBA Community
Interested in discussing this and other topics? Network with and learn from your peers with the app designed for community bankers.
Subscribe Today
Sign up for Independent Banker eNews to receive twice-monthly emails that alert you when a new issue drops and highlight must-read content you might have missed.
News Watch Today
Join the Conversation with ICBA Community
ICBA Community is an online platform led by community bankers to foster connections, collaborations, and discussions on industry news, best practices, and regulations, while promoting networking, mentorship, and member feedback to guide future initiatives.
Join the Community Example Text
