ATR, QM & QRM: Document it or lose it

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09/24/2013 by Consumer finance
ATR, QM & QRM: Document it or lose it

At a glance

In this PwC paper, we discuss the six questions that companies should ask themselves to help them consider the issues involved in making the necessary changes to comply with the ATR and QM standards.

Under recently re-proposed Qualified Residential Mortgage (QRM) and risk retention rules, if an issuer of an asset-backed security has a mortgage that is a QM but cannot evidence that it complies with the QM standard, the issuer does not, as a practical matter, have a QRM that would be exempt from the risk-retention requirements. Therefore, the re-proposed QRM rule amplifies the need for lenders, servicers and securities issuers need to make the process, governance and other changes necessary to ensure that mortgages are accompanied by documentation evidencing compliance with the ATR and QM standards.

In this PwC paper, we discuss the six questions that companies should ask themselves to help them consider the issues involved in making the necessary changes to comply with the ATR and QM standards.