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We would like to do a residential real estate loan with a 3 year balloon, 6.5% rate, and a 1% origination fee. After closing fees, the APR exceeds the 3.5% APOR small creditor portfolio QM threshold and does not comply with the small creditor QM balloon term requirement of 5 years or longer. We are a Community Development Financial Institution (CDFI), does that mean that we are exempt from all the ATR/QM requirements including the Small credit QM 3.5% APOR threshold and the balloon payment loan term of 5 years or longer? Would we be exempt from the HPML interior appraisal requirement?
I think the exclusion from the ATR rules would apply to the entire ATR rule, including the QM rules. If you are selling to an investor you would want to confirm their criteria. I do not believe your loans would be automatically exempt from the HPML interior inspection requirement because you are a CDFI. However, you could find some relief under comment 1026.35(c)(2)(i)-2.
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