A reader asked what it takes to get approved for a home loan in 2013, given the changes brought on by QM. Unfortunately, we are still awaiting the finalized version of those rules. So it’s a hard question to answer.
The qualified mortgage will set the bar for many aspects of home loans. But it doesn’t look like credit scores will be included in those requirements. At least, not at this stage.
Interest-only mortgages were common during the housing boom. These are loans where the borrower puts off repaying the principal amount. These products will likely be prohibited by QM.
Pre-approval is a process through which a lender evaluates a borrower’s credit, income and debts. The forthcoming qualified mortgage (QM) rules may alter this process somewhat, but it won’t be a major shakeup.
Will borrowers be required to put 20% down on mortgage loans, under the new QM rules? It’s not likely. The initial proposal prompted a storm of criticism from various groups.
Mortgage Rules for 2013
QualifiedMortgage.org is a resource center for consumers, lenders and journalists. We explain mortgage rules and regulations in plain English. We update this website on a regular basis, to keep up with new mortgage rules and requirements. This website is built around the new qualified mortgage (QM) rules that were announced in January 2013. You'll find an overview of the QM requirements on this page.
Update: New Mortgage Rules for 2013
In January 2013, the Consumer Financial Protection Bureau (CFPB) announced a new set of lending rules that will take effect immediately. The 'Ability to Repay' rule, as it has become known, requires lenders to verify a borrower's financial ability to repay the mortgage debt. You'll find a summary of these new requirements on this page.