813.910.8020 Apply Now

Mortgage Broker Tampa, FL | Mortgage Lender Tampa Florida | Marimark Mortgage

  • Home
  • Homebuyers
  • Homeowners
  • Realtors
  • Investors
  • About Marimark
  • Contact Us
  • Mortgages
  • Apply Now
  • Current Mortgage Rates
  • Calculators
  • Testimonials
  • Blog
  • Videos
  • Featured In
Home / Blog / Mortgage Rules / New Mortgage Rules: How will they affect you?

New Mortgage Rules: How will they affect you?

February 13, 2014 By Mary Catchur

Knowing mortgage rules and how they affect your are very important when applying for a loan.
CC Image by Simon Cunningham on Flickr

On January 10, 2014 new mortgage rules from the Consumer Financial Protection Bureau (CFPB) were implemented by lenders. There are two basic components of the rules: The Ability to Repay Rule (ATR) and the Qualified Mortgage (QM). The CFPB has characterized these new rules as a “back to basics” approach to lending intended to reduce the risk of foreclosures.

Ability to Repay Rule

Under the Ability to Repay Rule, lenders are required to calculate the borrower’s ability to repay the loan over the life of the loan.  To do so, they will verify and document assets, income and liabilities of the borrower, calculate a debt to income ratio and review credit history.  The requirement to verify and document these items eliminates the ability to do certain loans that were seen in previous years, such as “low-doc” and “no-doc loans”, also referred to as stated income loans.  However, most lenders have not offered these types of loans in several years.  This requirement also eliminates being able to qualify a borrower based on a low “teaser” rate that is only available for a short time.  If the loan has a rate that increases over its term, the lender must also make a reasonable effort to determine whether the borrower will be able to afford the payment under the higher rate as well.  This will help to prevent borrowers from finding themselves in trouble when interest rates adjust resulting in higher payments down the road.

Qualified Mortgage Rule

The Qualified Mortgage Rule (QM) establishes a new category of loans that must meet certain criteria.  Loans that fall into this category will be presumed to meet the ATR rule above.  To be considered a qualified mortgage, the loan must have no negative amortization, no terms longer than 30 years, no interest only payments and no balloon payments.  In addition, the borrower’s debt to income ratio cannot exceed 43% and certain upfront points and fees that a lender may charge are limited to 3% of the loan amount.

Many borrower’s have expressed concern about the 43% debt to income ratio limit and fear that it will make getting a loan more difficult.  However, there is currently an exception in place until January 2021 for loans that underwritten under Fannie Mae, Freddie Mac, FHA and USDA rural housing guidelines.

While some fear that these new rules may prevent homebuyers from obtaining financing, particularly first time homebuyers, , there are others who feel that these rules may cause lenders to loosen up credit standards, as there is now specific guidance for them to follow and use to defend their underwriting decisions.  The CFPB estimates that approximately 95% of the loans currently being originated would still qualify under the new guidelines.

Answers To Your Questions

If you have questions about whether you will qualify to purchase a home, a Marimark Mortgage loan consultant is always available to assist you.

You can apply online, apply over the telephone at 866-910-8020, and contact us with your questions.

Opt In Image
Stay Informed, It's Your Money
Marimark Mortgage Newsletter

The Marimark Mortgage Newsletter will keep you informed with important events in the mortgage industry that could impact your finances.

We especially focus on ways to save money on your current and future mortgages. And, we continually share the information we share with our clients, because we believe informed consumers are the best consumers.

Real estate agents, and other professionals in the industry, will receive an ongoing wealth of information that will help them serve their clients.

Thank you for signing up!

Filed Under: Mortgage Rules Tagged With: Mortgage, mortgage rules

Opinions, estimates, forecasts and other views contained in this page do not necessarily represent the views of Marimark Mortgage or its management and should not be construed as an offer to provide financing at the rates or terms mentioned. Due to market fluctuations, interest rates are subject to change at any time and without notice. Interest rates are also subject to credit and property approval. Although Marimark Mortgage attempts to provide reliable, useful information, it does not guarantee that the information is accurate, current or suitable for any particular purpose. Information from this page may be used with proper attribution.

Save with a Mortgage from Marimark

Whether you are buying a home or refinancing, you can save with a mortgage from Marimark Mortgage!



    [anr_nocaptcha g-recaptcha-response]

    Search

    Post Categories

    Testimonials

    Refinancing with Mary an absolute pleasure

     
    Refinancing with Mary has been an absolute pleasure. I have never been through the process before and she took the time to explain each step. She was prompt (had a rate locked in right away) and most importantly always answered the phone or emails almost immediately! The communication line alone made the refinancing process every bit worth it. Would recommend to anyone, and will be back for any future purchases! Bret Brennan, March 2021
    See More Reviews
    Marimark Mortgage LLC
    5327 Primrose Lake Circle
    Tampa, FL 33647-1328
    (813) 910-8020
    (866) 910-8020

    Accessibility
    Privacy Policy
    Terms of Service
    Sitemap

    Reviews

    Website Testimonials
    Google Reviews
    Zillow Reviews
    Trulia Reviews
    Facebook Reviews
    Yelp Reviews
    BBB A+ Rating

    FOLLOW US

    • ‎
    • ‎
    • ‎
    • ‎
    • ‎
    • ‎
    Marimark Mortgage is a BBB A+ Accredited Business

    Recent Posts

    • Top Things You Should Know About a Mortgage Pre-Approval
    • Why Homeowners Should Refinance Their Mortgage
    • Pros and Cons of a Variable-Rate Mortgage
    • Tips to Get the Best Interest Rate on Your Mortgage
    • Financing Closing Costs

    © 2022 Marimark Mortgage, LLC All Rights Reserved. | Internet Marketing by Image Building Media. | RSS Feed

    Reviews / Recommendations: Google, Zillow, Trulia, LinkedIn, Facebook, Yelp, BBB

    Licensed in Florida by the Office of Financial Regulation, Mortgage Lender License #MLD77.
    Licensed in Virginia by the Virginia State Corporation Commission, License MC#4556.
    Licensed in Pennsylvania by the Department of Banking and Securities, License #40222.
    NMLS#248318 – www.nmlsconsumeraccess.org.