Six months from now, how will we view the new QM rule?

By Mike Corn

In rare agreement, the Mortgage Bankers Association, CUNA and NAFCU have all expressed they are pessimistic about the new QM rules taking effect in January. Banking and credit union trade groups alike predict smaller financial institutions will leave the mortgage market, primarily because of the high compliance costs.

While both Senate and House representatives have suggested delaying implementation, it appears the CFPB is sticking to its original dates. So, what will this mean for credit unions, especially smaller ones?This article from CUNA’s News Now reports that many experts predict consumers will have less access to mortgages. And, this article from HousingWire quotes a credit union CEO who wonders what the landscape will look like six months from now.

If compliance burdens and costs rise, will very many credit unions abandon the home mortgage market altogether, leaving home buyers with fewer financing alternatives? Of course, that’s not the intent of the new rules but some predict it could be the effect.

One expert quoted in HousingWire referred to the new rules as “marginal changes in regulator compliance costs.” I doubt most mortgage lenders would refer to them that way. But, here’s something I don’t doubt. Owning a home is still important to most Americans. And credit unions have always found ways to serve their members.

Remember, during the depths of the financial crisis, it was credit unions that stepped up and continued making loans. Based on the spike in new credit union who have partnered with CU Realty Services this year, we’re betting credit unions will come through for members who want to buy homes.

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