The qualified mortgage definition was the topic of a House subcommittee hearing on Wednesday, part of a six-hearing campaign by Republicans challenging Dodd-Frank.

"GOP lawmakers and industry witnesses warned against defining 'QM' too narrowly, saying that could raise lending costs and hold back the recovery," writes American Banker's Joe Adler.

Dodd-Frank mandates rules on QM — a special class of loans that will have certain compliance advantages — are to be made by the Consumer Financial Protection Bureau.

One area of concern is whether lenders will get "safe harbor" or "presumed" status regarding ability-to-pay requirements. For lower-risk QM loans the safe harbor option is preferred by lenders, as it protects them from any charges that they overlooked the repayment ability of borrowers taking out QMs.

"We all want consumers to have safely underwritten mortgages. However, we must ensure that these reforms do not increase the cost of mortgage credit and, therefore, restrict creditworthy borrowers from receiving their mortgages," said Shelley Moore Capito, R-W.Va.

"Clear and unambiguous standards and a strong legal safe harbor are essential for a vibrant mortgage market in the future," said Debra Still, chairman-elect of the Mortgage Bankers Association.

For the full piece see: "GOP Continues Swipe at Dodd-Frank with Mortgage Rule Debate" (may require subscription).