(March 5, 2021) Saying he looks forward to approaching with an open mind the mission of the CFPB, director nominee Rohit Chopra told a Senate panel this week that fair and effective oversight of the mortgage market can promote a “resilient and competitive financial sector” while also addressing racial inequities.
Testifying before the Senate Banking Committee during a hearing on his nomination, Chopra said during the last economic crisis of 10 years ago, “we saw how unlawful and avoidable foreclosures proved to be catastrophic in cities, small towns, and rural areas alike, contributing to deeper social divisions and inequities.”
He said the country again faces “an important test to ensure that troubles in the housing market do not sabotage the recovery of our local economies.”
During questions and answers, Chopra said he also has an open mind about changes to qualified mortgage (QM) rules. He said he would look to what the statute says and what Congress’ goals are as the bureau reviews the rules. (See additional story, below.)
Last week, Acting Director Dave Uejio released a statement that the agency is considering revising or outright revoking the “seasoned QM” rule (which applies to portfolio loans meeting certain performance requirements over a 36-month seasoning period, including having no more than two delinquencies of 30 or more days and no delinquencies of 60 or more days). The bureau also said it “expects to shortly issue” a proposal that would delay the July 1 mandatory compliance date for the general QM rule.
Chopra, during his appearance before the panel, said the bureau won’t dictate financial policy. When it comes to QM, he said, “it is important that we balance the consumer protections that Congress has put into place with access, including for rural and other areas.”