Which of the following loan features would automatically disqualify a mortgage from Qualified Mortgage status?
Correct Answer
B) Interest-only payments for the first 5 years
Under 12 CFR 1026.43(e)(2)(i), QM loans cannot have interest-only payments. QM loans must have regular periodic payments that are substantially equal and fully amortize the loan over the loan term.
Why This Is the Correct Answer
Under 12 CFR 1026.43(e)(2)(i), QM loans cannot have interest-only payments. QM loans must have regular periodic payments that are substantially equal and fully amortize the loan over the loan term.
More Federal Laws Questions
A mortgage broker's website states 'Qualified borrowers can get loans with down payments as low as 3%.' Which statement about TILA advertising requirements is correct?
A loan's APR increases from 4.25% on the Loan Estimate to 4.35% on the Closing Disclosure due to a rate lock expiration. What action is required?
A lender originates a mortgage that meets all QM requirements. Three years later, the borrower defaults and claims the lender violated the ATR rule. What legal protection does the lender have?
For a closed-end mortgage loan, when must the creditor provide the Closing Disclosure to the borrower?
Which of the following documents must be provided to trigger the start of the 3-day rescission period?
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