CFPB Loan Thresholds Raised

Wednesday, August 20, 2014

The Consumer Financial Protection Bureau (CFPB) is raising the loan thresholds that determine points and fees on Qualified Mortgage (QM) loans.  This change goes into effect January 1, 2015.  That’s only 19 weeks away.

Last Friday’s ruling changes the allowable charges associated with a “safe” (QM) loan.  These loan limits will be adjusted annually due to inflation, as part of the Truth in Lending Act (TILA.)

CFPB now states that points & fees must not exceed:

  • 3 percent of the total loan amount for any loan greater or equal to $101,953;
  • $3,059 for loans equal or greater to $61,172 but less than $101,953;
  • 5 percent of the total loan amount for mortgages greater than or equal to $20,391 but less than $61,172;
  • $1,020 for loans greater than or equal to $12,744 but less than $20,391; or
  • 8 percent for loan amounts less than $12,744.