Consumer Financial Protection Bureau regulations implementing Dodd-Frank Act requirements that mortgage lenders consider consumers’ ability to repay home loans before extending them credit contains a The Dodd-Frank Act provides that qualified mortgages are entitled to a presumption that the creditor making the loan satisfied the ability-to-repay requirements. However, the Act did not specify whether the presumption of compliance is conclusive, thereby creating a safe harbor, or is rebuttable. The regulations provide a safe harbor for loans that satisfy the definition of a qualified mortgage
On July 11, 2012, in Congressional testimony, the securities industry urged the Consumer Financial Protection Board to adopt a safe harbor in the qualified mortgage regulations under the Dodd-Frank Act and reject the alternative of a rebuttable presumption which, according to SIFMA, carries the risk of assignee liability. In testimony before the House Financial Institutions Subcommittee. SIFMA senior official Ken Bentsen, cautioned that a rebuttable presumption in the qualified mortgage regulations would have transferred liability to securitizers and investor, SIFMA urged a safe harbor. Given the impact of assignee liability, SIFMA believes it critical that the final rules provide for certainty of compliance with ability to repay requirements.