Federal regulators are telling their examiners to overlook non-qualified mortgage loans as long as they are underwritten well, according to what nationalmortgagenews.com tells MHProNews. The joint statement from the Federal Reserve Board, the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corp. (FDIC) and the National Credit Union Administration (NCUA) informs lenders they should consider their business strategy and risk appetite as more important than whether the loan qualifies for QM status or not. The joint statement says, “Regardless of whether residential mortgage loans are QMs or non-QMs, the agencies continue to expect institutions to underwrite residential mortgage loans in a prudent fashion and address key risk areas in their residential mortgage lending, including loan terms, borrower qualification standards, loan-to-value limits, and documentation requirements.” The Department of Housing and Urban Development (HUD) has issued its own QM rule for FHA loans which takes effect Jan. 10.
