June 25, 2021 Release: QM Enhancements

This release updates the QM policy functionality in the system to incorporate the revised General Qualified Mortgage (QM) definition in the CFPB’s rule.

Although not effective for all applicable mortgages until October 1, 2022, Fannie Mae and Freddie Mac will no longer acquire loans that do not meet the new rule for loans that have application dates on or after July 1, 2021. In addition, for Fannie loans that are purchased as whole loans on or after August 31st, or in MBS pools on or before August 1st must meet the new guidelines. For Freddie Mac loans all loans with settlement dates after August 31st must meet the new guidelines.

This enhancement to our QM policy functionality includes the ability to create new custom policies based on CFPB guidelines or GSE guidelines. The CFPB policy mirrors the existing configuration options. All existing configured policies that are applied to product groups will not be changed with this release and will continue to evaluate as they do today.

The new GSE policy type incorporates the following QM changes:

  • Removes the DTI Test.
  • Adds a new loan amount and property type price-based test.
  • Incorporates a new QM APR calculation to replace the “standard” APR in all QM related tests.
  • Removes configuration options that are no longer applicable, allowing for a more streamlined setup.

QM policies are assigned to Product Categories, allowing you to apply the GSE policy with these changes only to GSE products.

Please see the 2021.03 06/11/2021 Release Notes and Webcast help article to view a recorded webcast about these updates. Also see our Administrator and Secondary User and Loan Originator guides to learn more about the new policy configuration options.

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