Under conclusive presumption, the qualification is granted to loans meeting which criteria?

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Multiple Choice

Under conclusive presumption, the qualification is granted to loans meeting which criteria?

Under conclusive presumption, a loan automatically qualifies as a Qualified Mortgage if it is a prime loan that meets the general QM standards. This means the loan is considered low-risk and made to a borrower with strong credit and stable income, and it features like a standard 30-year or shorter fully amortizing term, no negative amortization or balloon payments, and a points-and-fees amount within the QM limit. When these criteria are met, the lender enjoys a safe harbor from certain ATR liability. Non-conforming or jumbo loans generally do not fit these parameters, and simply being a conforming loan isn’t enough if the loan doesn’t meet the general QM standards.

Under conclusive presumption, a loan automatically qualifies as a Qualified Mortgage if it is a prime loan that meets the general QM standards. This means the loan is considered low-risk and made to a borrower with strong credit and stable income, and it features like a standard 30-year or shorter fully amortizing term, no negative amortization or balloon payments, and a points-and-fees amount within the QM limit. When these criteria are met, the lender enjoys a safe harbor from certain ATR liability.

Non-conforming or jumbo loans generally do not fit these parameters, and simply being a conforming loan isn’t enough if the loan doesn’t meet the general QM standards.

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