There might be alternate options for determining a borrower’s creditworthiness beyond a strict dti metric.
“With respect to your 43% DTI limit, it will make sense that is little agree to a rigid requirement that doesn’t take into account the complexities of underwriting. Alternatively, we must give attention to options, like allowing the utilization of compensating factors or applying a residual income test, ” Broeksmit penned. “Allowing because of this flexibility will make certain that lower-income borrowers and minorities are better in a position to be involved in the process that is home-buying without presenting undue danger towards the system. ”
The group does not believe any other changes to the QM rule are necessary outside of eliminating the DTI ratio requirement and the associated Appendix Q. Continue reading