Legal Blog

Compensation and Compliance Matters: Proposed Fix for QM Helps, but Falls Short of Needed Clarity

Last week the Consumer Financial Protection Bureau announced that it was considering allowing a cure for mortgages that were closed as qualified mortgages but which after the fact lost their QM status when it was later determined the upfront points and fees exceeded the 3% cap. The CFPB proposed a 120-day period wherein lenders could cure an “overcharge” exceeding the cap if certain conditions were met. These conditions include (1) that the loan was originated in good faith with the belief that the loan did not exceed the 3% cap (which can be demonstrated by policies meant to avoid mistakes), (2) consistency in loan pricing amongst similar loans, and (3) that post-closing review procedures identify the mistake before it is brought to the lenders’ attention by the consumer or investor. Click here to read the entire article If you have any questions about please contact Ari Karen at: Bank Manager  | 240.507.1740 Ari Karen is an experienced litigator and speaker who has focused his practice in representing financial institutions in both government investigations and litigation before state and federal trial and appellate courts nationwide. Mr. Karen’s practice is diverse, representing clients on matters concerning banking regulations, Dodd Frank financial reform laws, contractual disputes, employment and labor statutes, wage-hour class actions, employment discrimination and fair lending matters, whistleblower complaints and non-competition claims, among others. You can also connect with Offit Kurman via FacebookTwitterGoogle+YouTube, and LinkedIn.