80 FR 8243 - HUD's Qualified Mortgage Rule: Annual Threshold Adjustments to the Points and Fees Limit
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Federal Register Volume 80, Issue 31 (February 17, 2015)
Federal Register Volume 80, Issue 31 (February 17, 2015)
| Page Range | 8243-8243 | |
| FR Document | 2015-03139 |
[Federal Register Volume 80, Number 31 (Tuesday, February 17, 2015)] [Rules and Regulations] [Page 8243] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-03139] [[Page 8243]] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 24 CFR Part 203 [Docket No. FR-5845-N-01] HUD's Qualified Mortgage Rule: Annual Threshold Adjustments to the Points and Fees Limit AGENCY: Office of the Assistant Secretary for Housing--Federal Housing Commissioner, HUD. ACTION: Announcement of HUD's qualified mortgage rule's annual threshold adjustments. ----------------------------------------------------------------------- SUMMARY: The Consumer Financial Protection Bureau (CFPB) issued a final rule entitled ``Truth in Lending (Regulation Z) Annual Threshold Adjustments (CARD ACT, HOEPA and ATR/QM)'' on August 15, 2014. The final rule re-calculated the annual dollar amounts for the points and fees limit in CFPB's ``qualified mortgage'' definition to reflect the annual percentage change in the Consumer Price Index in effect on June 1, 2014. HUD's ``qualified mortgage'' definition incorporates CFPB's qualified mortgage points and fees limit and the requirement that the points and fees limit be adjusted annually. This document clarifies that all annual adjustments to the qualified mortgage points and fees limit issued by the CFPB to reflect the Consumer Price Index apply to HUD's points and fees limit provision, including CFPB's most recent final rule. DATES: Effective Date: February 17, 2015. FOR FURTHER INFORMATION CONTACT: Michael P. Nixon, Office of Housing, Department of Housing and Urban Development, 451 7th Street SW., Room 9278, Washington, DC 20410; telephone number 202-402-5216, ext. 3094 (this is not a toll-free number). Persons with hearing or speech impairments may access this number through TTY by calling the Federal Relay Service at 800-877-8339 (this is a toll-free number). SUPPLEMENTARY INFORMATION: I. Background On December 11, 2013, at 78 FR 75215, HUD published a final rule that established a definition of ``qualified mortgage'' for single family residential mortgages that HUD insures, guarantees, or administers. Under HUD's qualified mortgage rule, qualified mortgage status attaches at origination and insurance endorsement to those single family residential mortgages insured under the National Housing Act (12 U.S.C. 1701 et seq.), section 184 loans for Indian housing under the Housing and Community Development Act of 1992 (12 U.S.C. 1715z-13a), and section 184A loans for Native Hawaiian housing under the Housing and Community Development Act of 1992 (12 U.S.C. 1715z- 13b). HUD's definition of ``qualified mortgage'' is codified for each program at 24 CFR 201.7, 203.19, 1005.120 and 1007.80. HUD has defined ``qualified mortgage'' in a manner that aligns HUD's definition, to the extent feasible and consistent with HUD's mission, with that of the ``qualified mortgage'' definition promulgated by the CFPB, and which is codified at 12 CFR 1026.43. HUD undertook the alignment for the purpose of lessening future differences in standards for HUD's single family residential insured mortgages and those established by the CFPB, which apply to conventional, federally-related mortgages for which designation as a qualified mortgage is sought. HUD's alignment to CFPB's standards at 24 CFR 203.19 includes a cross-reference to the CFPB's limit on points and fees for a qualified mortgage at 12 CFR 1026.43(e)(3). The CFPB's qualified mortgage limit on points and fees requires that to be a ``qualified mortgage,'' the transaction's points and fees must not exceed 3 percent of the total loan amount for a loan amount greater than or equal to $100,000; $3,000 for a loan amount greater than or equal to $60,000 but less than $100,000; 5 percent of the total loan amount for loans greater than or equal to $20,000 but less than $60,000; $1,000 for a loan amount greater than or equal to $12,500 but less than $20,000; and 8 percent of the total loan amount for loans less than $12,500. The definition also provides that the dollar amounts should be adjusted annually on January 1 by the annual percentage change in the Consumer Price Index for All Urban Consumers (CPI-U) that was reported on the preceding June 1. Members of the public interested in more detail about HUD's qualified mortgage regulations may refer to the preamble of HUD's September 30, 2013, proposed rule and HUD's December 11, 2013, final rule, at 78 FR 59890 and 78 FR 75215, respectively. II. HUD Notice of CFPB's Final Rule On August 15, 2014, the CFPB issued a final rule ``Truth in Lending (Regulation Z) Annual Threshold Adjustments (CARD ACT, HOEPA and ATR/ QM).'' (79 FR 48015) CFPB's final rule amended the points and fees limit at 12 CFR 1026.43(e)(3), as required by 12 CFR 1026.43(e)(3)(ii), to reflect the annual inflation in the (CPI-U), as published by the Bureau of Labor Statistics, as of June 1, 2014. The adjustment adopted reflected a 2 percent increase in the CPI-U for the required period and is rounded to whole dollars for ease of compliance. The new points and fees limit, effective January 1, 2015, requires that for a covered transaction to be a qualified mortgage the total points and fees must not exceed 3 percent of the total loan amount for a loan greater than or equal to $101,953; $3,059 for a loan amount greater than or equal to $61,172 but less than $101,953; 5 percent of the total loan amount for a loan greater than or equal to $20,391 but less than $61,172; $1,020 for a loan amount greater than or equal to $12,744 but less than $20,391; and 8 percent of the total loan amount for a loan amount less than $12,744. HUD's reference to 12 CFR 1026.43(e)(3) in its final rule included the requirement that the points and fees limit be updated annually to reflect the CPI-U. Therefore, this document clarifies that all adjustments to the CFPB's point and fees limit consistent with 12 CFR 1026.43(e)(3)(ii) are to be incorporated into HUD's points and fees limit per the effective date of the CFPB's adjustment, including the most recent change issued on August 15, 2014. Dated: February 9, 2015. Biniam Gebre, Acting Assistant Secretary for Housing--Federal Housing Commissioner. [FR Doc. 2015-03139 Filed 2-13-15; 8:45 am] BILLING CODE 4210-67-P
![Federal Register / Vol. 80, No. 31 / Tuesday, February 17, 2015 / Rules and Regulations 8243
DEPARTMENT OF HOUSING AND housing under the Housing and annual inflation in the (CPI–U), as
URBAN DEVELOPMENT Community Development Act of 1992 published by the Bureau of Labor
(12 U.S.C. 1715z–13a), and section 184A Statistics, as of June 1, 2014. The
24 CFR Part 203 loans for Native Hawaiian housing adjustment adopted reflected a 2
[Docket No. FR–5845–N–01] under the Housing and Community percent increase in the CPI–U for the
Development Act of 1992 (12 U.S.C. required period and is rounded to whole
HUD’s Qualified Mortgage Rule: 1715z–13b). HUD’s definition of dollars for ease of compliance. The new
Annual Threshold Adjustments to the ‘‘qualified mortgage’’ is codified for points and fees limit, effective January
Points and Fees Limit each program at 24 CFR 201.7, 203.19, 1, 2015, requires that for a covered
1005.120 and 1007.80. transaction to be a qualified mortgage
AGENCY: Office of the Assistant HUD has defined ‘‘qualified the total points and fees must not
Secretary for Housing—Federal Housing mortgage’’ in a manner that aligns exceed 3 percent of the total loan
Commissioner, HUD. HUD’s definition, to the extent feasible amount for a loan greater than or equal
ACTION: Announcement of HUD’s and consistent with HUD’s mission, to $101,953; $3,059 for a loan amount
qualified mortgage rule’s annual with that of the ‘‘qualified mortgage’’ greater than or equal to $61,172 but less
threshold adjustments. definition promulgated by the CFPB, than $101,953; 5 percent of the total
and which is codified at 12 CFR loan amount for a loan greater than or
SUMMARY: The Consumer Financial 1026.43. HUD undertook the alignment equal to $20,391 but less than $61,172;
Protection Bureau (CFPB) issued a final for the purpose of lessening future $1,020 for a loan amount greater than or
rule entitled ‘‘Truth in Lending differences in standards for HUD’s equal to $12,744 but less than $20,391;
(Regulation Z) Annual Threshold single family residential insured and 8 percent of the total loan amount
Adjustments (CARD ACT, HOEPA and mortgages and those established by the for a loan amount less than $12,744.
ATR/QM)’’ on August 15, 2014. The CFPB, which apply to conventional, HUD’s reference to 12 CFR
final rule re-calculated the annual dollar federally-related mortgages for which 1026.43(e)(3) in its final rule included
amounts for the points and fees limit in designation as a qualified mortgage is the requirement that the points and fees
CFPB’s ‘‘qualified mortgage’’ definition sought. limit be updated annually to reflect the
to reflect the annual percentage change HUD’s alignment to CFPB’s standards CPI–U. Therefore, this document
in the Consumer Price Index in effect on at 24 CFR 203.19 includes a cross- clarifies that all adjustments to the
June 1, 2014. HUD’s ‘‘qualified reference to the CFPB’s limit on points CFPB’s point and fees limit consistent
mortgage’’ definition incorporates and fees for a qualified mortgage at 12 with 12 CFR 1026.43(e)(3)(ii) are to be
CFPB’s qualified mortgage points and CFR 1026.43(e)(3). The CFPB’s qualified incorporated into HUD’s points and fees
fees limit and the requirement that the mortgage limit on points and fees limit per the effective date of the CFPB’s
points and fees limit be adjusted requires that to be a ‘‘qualified adjustment, including the most recent
annually. This document clarifies that mortgage,’’ the transaction’s points and change issued on August 15, 2014.
all annual adjustments to the qualified fees must not exceed 3 percent of the Dated: February 9, 2015.
mortgage points and fees limit issued by total loan amount for a loan amount
Biniam Gebre,
the CFPB to reflect the Consumer Price greater than or equal to $100,000; $3,000
Acting Assistant Secretary for Housing—
Index apply to HUD’s points and fees for a loan amount greater than or equal
Federal Housing Commissioner.
limit provision, including CFPB’s most to $60,000 but less than $100,000; 5
[FR Doc. 2015–03139 Filed 2–13–15; 8:45 am]
recent final rule. percent of the total loan amount for
BILLING CODE 4210–67–P
DATES: Effective Date: February 17, loans greater than or equal to $20,000
2015. but less than $60,000; $1,000 for a loan
amount greater than or equal to $12,500
FOR FURTHER INFORMATION CONTACT: DEPARTMENT OF HOUSING AND
but less than $20,000; and 8 percent of
Michael P. Nixon, Office of Housing, URBAN DEVELOPMENT
the total loan amount for loans less than
Department of Housing and Urban $12,500. The definition also provides
Development, 451 7th Street SW., Room 24 CFR Part 982
that the dollar amounts should be
9278, Washington, DC 20410; telephone adjusted annually on January 1 by the [Docket No. FR–5827–F–01]
number 202–402–5216, ext. 3094 (this is annual percentage change in the
not a toll-free number). Persons with Removal of Obsolete Section 8 Rental
Consumer Price Index for All Urban
hearing or speech impairments may Assistance Certificate Program
Consumers (CPI–U) that was reported
access this number through TTY by Regulations
on the preceding June 1. Members of the
calling the Federal Relay Service at 800– public interested in more detail about AGENCY: Office of the Assistant
877–8339 (this is a toll-free number). HUD’s qualified mortgage regulations Secretary for Public and Indian
SUPPLEMENTARY INFORMATION: may refer to the preamble of HUD’s Housing, HUD.
I. Background September 30, 2013, proposed rule and ACTION: Final rule.
HUD’s December 11, 2013, final rule, at
On December 11, 2013, at 78 FR 78 FR 59890 and 78 FR 75215, SUMMARY: This final rule removes from
75215, HUD published a final rule that respectively. regulations obsolete references to the
established a definition of ‘‘qualified Section 8 Tenant-Based Rental
mortgage’’ for single family residential II. HUD Notice of CFPB’s Final Rule Assistance Certificate program
mortgages that HUD insures, guarantees, On August 15, 2014, the CFPB issued (Certificate Program). In accordance
or administers. Under HUD’s qualified a final rule ‘‘Truth in Lending with Executive Order 13563,
tkelley on DSK3SPTVN1PROD with RULES
mortgage rule, qualified mortgage status (Regulation Z) Annual Threshold ‘‘Improving Regulation and Regulatory
attaches at origination and insurance Adjustments (CARD ACT, HOEPA and Review,’’ HUD reviewed its regulations
endorsement to those single family ATR/QM).’’ (79 FR 48015) CFPB’s final to identify regulations that are
residential mortgages insured under the rule amended the points and fees limit ‘‘outmoded, ineffective, insufficient or
National Housing Act (12 U.S.C. 1701 et at 12 CFR 1026.43(e)(3), as required by excessively burdensome.’’ Following its
seq.), section 184 loans for Indian 12 CFR 1026.43(e)(3)(ii), to reflect the review, HUD determined that the
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Document Created: 2015-12-18 13:19:41
Document Modified: 2015-12-18 13:19:41
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Rules and Regulations | |
| Action | Announcement of HUD's qualified mortgage rule's annual threshold adjustments. | |
| Contact | Michael P. Nixon, Office of Housing, Department of Housing and Urban Development, 451 7th Street SW., Room 9278, Washington, DC 20410; telephone number 202-402-5216, ext. 3094 (this is not a toll-free number). Persons with hearing or speech impairments may access this number through TTY by calling the Federal Relay Service at 800-877-8339 (this is a toll-free number). | |
| FR Citation | 80 FR 8243 |
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