The US Consumer Financial Protection Bureau ("CFPB")
continues to amend its Title XIV mortgage rules, almost two years
after they were issued. On October 22, 2014, the CFPB issued a
final rule ("Rule") allowing lenders to cure loans that
do not meet the "points and fees" test under the
CFPB's Ability-to-Repay/Qualified Mortgage Rule. Under the
Rule, lenders and investors will be able to "cure" loans
for which the "points and fees" exceed the 3% cap for
Qualified Mortgages ("QMs"). Lenders and investors will
be able to cure a loan and ensure its QM status by refunding the
"points and fees" that exceed the 3% cap, with interest.
The Rule allows the cure payment to be provided within 210 days
after consummation. The cure will be available for loans
consummated on or after the effective date of the Rule, which will
be upon publication in the Federal Register, expected in
the next week or two.
