How to test a loan against the revised General QM definition?
Beginning July 1, 2021, creditors have an option to use either the current General QM definition or the revised, price-based General QM definition. For this purpose, Revised General has been added to the QM Type field on the Loan Definition page. If this option is selected, the loan will be tested against the updated General QM definition.
- Select General in the QM Type field on the Loan Definition page to continue using the current General QM definition.
- Select the Revised General option on the Loan Definition page to use the updated
General QM definition.
- After completing the required fields, select ATR/HOEPA/HPML/QM in the Services Menu to go to the Interface page. For the revised General QM, you do not need to enter additional QM- related information on the Interface page.
- After you select the Get Lending Analysis Report button,
the Wiz Sentinel report will be generated. The QM section will
reflect the 2021 rule update (i.e. DTI related information will
no longer be shown on the report).
- For the ARM loans where the interest rate can change during the first five years of the loan, the APR will be calculated based on the maximum interest rate that may apply during that five-year period as the interest rate for the full term of the loan. This specific APR will be used for the revised General QM purposes only.
- If the loan is fixed rate and first lien, the system will print the following additional
language on the Wiz Sentinel report stating that the loan can potentially
qualify for Seasoned QM: ‘In addition, this loan satisfies some of the
criteria necessary for designation as a Seasoned QM. Final designation of
Seasoned QM status cannot be determined until all post-closing performance
and portfolio requirements are met.’Note: If you are interested in learning more about the revised General QM, please visit the following resources: