Underwriting

The new calculation of borrowers’ monthly obligations will allow for a higher debt load from tuition, potentially opening eligibility to more Black applicants, according to public officials.

The White House directive may lead regulators to develop new mortgage underwriting standards, stress-test requirements and flood insurance policy, observers said.

Some applaud the agency's recent delay of the mandatory compliance date for a new Qualified Mortgage standard. Others say it leads to more uncertainty for lenders, opens the door to additional changes and enables some companies to loosen their underwriting.

The consumer bureau's revamp of criteria for "qualified mortgages," a special regulatory class of loans free from liability, emphasizes pricing instead of a borrower's debt-to-income ratio.

Demand trends were mixed in the third quarter, with consumers showing more willingness than businesses to take on new debt, according to the Fed’s most recent survey on bank lending practices.

The agency confirmed that loans backed by Fannie Mae and Freddie Mac can continue avoiding debt-to-income limits as the bureau completes a revamp of the Qualified Mortgage standard.

The agency had raised concerns in the Obama administration about kickbacks in the marketing pacts between mortgage lenders and other providers, but the agency's recent guidance says the deals are legally viable.

The Consumer Financial Protection Bureau's overhaul of its Qualified Mortgage standard is alarming free-market advocates who say it will precipitate a return to easy credit and higher defaults and could disproportionately harm minorities.

The agency’s plan to extend the "qualified mortgage" stamp of approval to more loans could help lenders that rely on alternative data and cushion the blow of other QM changes for Fannie Mae and Freddie Mac.

The Consumer Financial Protection Bureau says the proposal would increase access to credit, but consumer groups argue that it will encourage lenders to make high-cost loans while protecting them from legal liability.

The Consumer Financial Protection Bureau says the proposal would increase access to credit, but consumer groups argue that it will encourage lenders to make high-cost loans while protecting them from legal liability.

An industry coalition wants to ensure borrowers who took out certain types of loans to fund their education aren’t locked out of access to historically low mortgage rates.

The key word is "temporary" with the FHA's quality control waiver expiring and not likely to be renewed.

Citing possible exploitation, Bank of America instituted a policy that put limits on loans to persons in guardianship. It later ended the policy.

Lenders need to use alternative data as an overlay to traditional underwriting methods to help creditworthy customers in hardship because of the coronavirus crisis.

The availability of some loans used to build homes dried up due to the coronavirus. Opening up the economy may help if it doesn't lead to a spike in infections, and if consumer demand persists.

Mortgage rates are at record lows, but borrowers hoping to take advantage are running into the toughest loan-approval standards in years.

The Federal Housing Finance Agency authorized the government-sponsored enterprises to lend additional support to the mortgage-backed securities market and temporarily allow some flexibility in lending requirements to address coronavirus-related concerns.

Banks' lowering of origination fees and loosening of underwriting standards often foreshadow a downturn.

Now that the Consumer Financial Protection Bureau says it will scrap an unpopular standard for so-called qualified mortgages, the big question is what will take its place.