The CFPB on April 30 issued a proposed amendment to its home mortgage loan rules that would, in limited circumstances, allow lenders that have exceeded the applicable points and fees cap to refund the excess amount to consumer borrowers in order to classify the loan as a Qualified Mortgage. Comments on the proposed amendment are due by July 7, 2014.

     Nutter Notes: Under the CFPB’s Ability-to-Repay rule, the points and fees charged to a consumer on a Qualified Mortgage generally cannot exceed 3% of the loan principal. The amendment would allow a lender which believes it has offered a Qualified Mortgage but afterwards discovers that it has exceeded the cap to refund the excess and still meet the legal requirements of a Qualified Mortgage, provided the refund occurs within 120 days after the loan is made.