The Qualified Mortgage Rule will take effect next January “to spur the revival of the home lending market,” according to Barry Rutenberg, chairman of the National Association of Home Builders (NAHB). He adds that it is essential that regulators act prudently and thoughtfully in the coming year to implement this rule in a sensible manner to avoid disruptions to the housing finance system and ensure qualified borrowers can obtain affordable credit.

He also issued a statement regarding the Consumer Financial Protection Bureau’s newly-released standard on the definition of a qualified mortgage (QM) which addresses the borrower’s ability to repay a home loan.

“We appreciate the hard work the Consumer Financial Protection Bureau has put into this effort to create a qualified mortgage standard that ensures home buyers have access to affordable mortgages, contains strong consumer protections and provides lenders proper incentives to make home loans to creditworthy borrowers.

“The qualified mortgage rule stipulates that borrowers must be able to repay home loans issued to them and will set the parameters for all mortgage financing going forward. So it is essential that it strikes the proper balance that encourages lenders to provide creditworthy borrowers access to affordable home loans, and also gives assurances to financial institutions that they will be protected from lawsuits if they meet the criteria set forth in the rules.

“Our initial review of the QM rule indicates that this balanced approach can be achieved. NAHB is encouraged that regulators heeded concerns from the housing industry to craft a broad standard that includes many of today’s sound mortgage products, including fixed-rate and adjustable-rate mortgages, under the QM standard.”

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