When it comes to the Ability to Repay (ATR) rules and the Qualified Mortgage (QM) requirements, there are certain instances where written policies and procedures are required. For instance, if you make non-QM loans, you must still comply with the ATR requirements but you do not need written policies and procedures. Written policies and procedures are not required for those small creditors making portfolio QM or balloon QMs either. On the other hand, if you make seasoned QMs or general QMs, you must have written policies and procedures. Here’s the thing, even if you are you not required to maintain written policies and procedures in those few instances, we often recommend you do so. Not only does it help get all your lenders on the same page, but it also often helps with your fair lending compliance efforts.
Kevin explains more in the video.