Will New Mortgage Rules Help or Hurt Buyers?

New mortgage lending standards were put into place this month by the Consumer Financial Protection Bureau to protect borrowers from the risky home loan products that contributed to the foreclosure crisis of the last decade. The rules require mortgage lenders to make a good faith effort determination of a home buyer’s ability to repay the loan and ensure that homeownership is an affordable step for the borrower.

At least 90 percent of home buyers will be able to take advantage of loans that meet the new standards, called Qualified Mortgages. Most banks will also offer non-QM loans to buyers who are deemed an acceptable risk, though critics worry that the new rules are overly protective and could actually prevent some consumers from buying homes.

Story Springboard

• The Changing Landscape

Talk to a Realtor® about how the new Ability-to-Repay rules might impact their home buying clients. Talk to mortgage lenders in your area about what borrowers can expect when they apply for a loan. Reach out to borrowers in your area to see if they are aware of the coming changes.