Massachusetts Division of Banks Proposes Amendments to “Borrower’s Interest” Regulations

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The Massachusetts Division of Banks proposed amendments to current regulations that would create a safe harbor from regulations that impose restrictions on refinancing home loans for qualified mortgage loans. The regulation prohibits lenders from knowingly refinancing a home loan that was consummated within the prior 60 months unless the refinancing is in the borrower’s interest. The proposed amendments provide that a home loan will be in compliance with the regulation if it is a qualified mortgage as defined by the CFPB’s ability-to-repay and qualified mortgage rule.

The Division of Banks also scheduled a public hearing on April 9, 2014 to discuss the proposed amendments.

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this informational piece (including any attachments) is not intended or written to be used, and may not be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

Topics:  Ability-to-Repay, CFPB, Mortgages, Qualified Mortgage Rule

Published In: Consumer Protection Updates, Finance & Banking Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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