Am I reading this correctly that a “Small Creditor Portfolio QM” does not have to use Appendix Q? Therefore we are able to create our own guidelines to qualify credit??? Do you still have to abide by the Gen ATR 8 factors? I’m not trying to shortcut – Just need to know!
Take a look at 1026.43(e)(5) for the rules you need to follow as a lender making loans under the small creditor portfolio option. You will not need to use Appendix Q, but you will need to consider DTI as outlined in 1026.43(e)(5)(i)(B). Also, you will not have to abide by the 43% DTI cap if you are using the small creditor portfolio QM option. Here’s a link to 1026.43 (the commentary is also a good place for additional information): https://www.ecfr.gov/cgi-bin/text-idx?SID=d7bde6371e95b688a396f863c3ddd6f3&node=20130612y1.42