Transcripts For CSPAN New Mortgage Qualification Rules 20130114

We understand the intent of congress and the cfpb to prevent mortgage but uses in the future and stabilizing the Housing Market. Nevertheless, we are concerned that the plethora of regulatory changes could further stymie the Housing Market and Community Banks ability to provide Mortgage Loans. For this reason, we urge the cfpb to tailor the rules so they do not inhibit many banks ability to provide mortgages. Many Community Bank Mortgage Loans are held in portfolio and are not sold on the secondary market. The banks have a vested interest in how the loans perform. Accordingly, they are underwriting the underwriting for these loans has historically been more conservative. Many of these loans are not cookie cutter loans they are made to borrowers who cannot qualify for a secondary market loan and not because they do not have the ability to repay, but because their properties may be unique. It may be a large parcel or have outbuildings that do not qualify for the secondary market. Like the example the director mentioned earlier, they may not be comparable sales there may not be comparable sales in the requisite Geographic Area or time to qualify for secondary market loans. Community banks are especially adept at making the loans because the bankers know their customers and have Extensive Knowledge of the Housing Market in their local community. The standards and definitions that in a qualified mortgage a rule will have far reaching impact. Borrowers on the wrong side of the qm will not be able to get the mortgage they want, or they will pay considerably more for it. Many Community Banks will significantly curtail mortgage lending if there is only if there is only a rebuttable presumption of compliance for qualified mortgages. They could not assume the litigation risk. They strongly advocated that the rules provide a safe harbor for qualified mortgages. Weve also urged that Community Bank Mortgage Loans held in portfolio receive this legal safe harbor. We are pleased hero recognizes these concerns with in crafting a final rule and a proposed amendment. We believe the safe harbor for qualified mortgages which includes rural balloon payment mortgages will enable Community Banks to be able to continue to serve their clients and communities of providing safe and sound and affordable mortgage credit. We look forward to working with the bureau as the process move forward. Community banks recognize that Mortgage Finance is at a crossroads, and we urged policymakers to continue to take the path that will enable Community Banks to provide Mortgage Loans to their customers so that these consumers can also achieve Home Ownership. Thank you. Thank you very much. We would like to take a few minutes for myself and my colleagues from the bureau to follow up on issues that were raised in the statements. I will take the liberty of beginning perhaps by asking a Consumer Panel to elaborate on one theme the ability to repay rule and the qualified mortgage definition. Theyre not intended nor can one imagines them being some kind of global panacea, but in the context of other protections that already exist or were created by doddfrank, how is it that you view the impact of this rule moving forward . Thank you. The ability to repave requirement is part of the truth in lending act, and it was built on the notion of disclosure being the answer to market issues, something that professor wachter alluded to. This provision is really a step in a new direction, to say that disclosure matters, we need better information in the market, but in addition fairness is a key part of having a functioning market. Having a standard will allow this to occur, and having this issue by an agency which for the first time has its main goal and focus to benefit consumers is also a novel set of regulations and a novel paradigm. This is your first significant mortgage rule, and we congratulate you. Lets hope the microphone works this time. Thanks for the question period is a very important one. One of the things that we advocated for in the lead up to the crisis were for regulators to adopt a set of rules that would apply across the markets very broadly. We were seeing a very grave difference between loans that were being originated in the subprime market verse is the prime market. Versus the prime market. What we wanted were unified standards applicable across the board to all mortgages so that we could help standardize the mortgage experience for consumers but also insure basic protections for consumers. As you have already said, the ability to repay standard is not a panacea. Just because we have this does not mean we will not see abuses in the marketplace. But what it does do is take us in that direction of establishing uniform base standards, Safety Standards for all Mortgage Loans in america. Thank you. One of the parts of this rule that will be so important is that it sets standards that not only apply for this role, but are widely anticipated to be adopted in other important ways. There have already been legislative proposals that the Government Agencies that insure loans can only ensure qualified mortgages. This rule relates legally and is tied to another rule that addresses whether those who securitized mortgages have to set aside extra capital. They will have to set aside extra capital for the loans that are not qm. It not only provides the definition for this particular rule, is seen widely as adopting standards that will largely defined the market. It does so in three categories. Theres been a lot of discussion, but there are three categories coming out of todays rule. What are prime qm loans . The idea is the rule sets up incentives to align those of lenders and borrowers so that if you make a prime qm loan, the borrowers should nevis strong likelihood of success in that loan. In the subprime space, even before the crisis those loans carry significant risks for borrowers. Before the crisis, back in the late 1990s, 2000, if you took a subprime loan your chances were one out of three that you would end up losing at home. Appropriately, those loans should be available, but with great care. Finally, the third category i would address today these rules affect the socalled very highcost loans. That would be a loan with more than 10 interest, for example, as compared to the 3. 5 most people get today. Even more so than subprime, those loans should not be prohibited, but should be limited to very extraordinary circumstances and there should be strict protections there. I think this is a movement in that direction and comes close to hitting that mark. Thank you. Why dont i invite one of my colleagues pete carroll is our assistant director for Mortgage Markets. This next question is for professor wachter. If the ability to repay rules had been in place in the lead up to the financial crisis, what might this segment for consumers . In the runup to the crisis, borrowers assumed lenders were in the business of payable loans. I believe this would have prevented such loans from being made without concrete warning to consumers and would have prevented much suffering to borrowers and harm to consumers and the broader economy. Thank you. This next question is for ms. Rice of the National Fair housing alliance. Most folks would generally agree that underwriting standards were far too loose in the lead up to the crisis, and theyre currently too restrictive. What does this rule mean for extending access into the non prime mortgage space Going Forward . Thank you for the question. I am reminded of the first predatory lending case that i work done the early 1990s. It involved a senior citizen, a single female head of household who had known her home in toledo for years, for decades. She had a prime mortgage she had been paying faithfully and had stellar credit. She was convinced to refinance out of that prime sustainable mortgage, fixedrate mortgage, with charter one bank. Into a subprime loan to get a debt consolidation loans. She was convinced to do this because the lender told her she would have just one payment, and that really appealed to her because she was on a fixed income. She was going to pay off for other debt. You know the story at the closing table, all of the terms and conditions were completely changed dunderhead. She got a subprime loan that the Interest Rate was more than double the prime rate she had been paying and the lender did not pay off all of her a debt. Her total debt to income ratio skyrocketed. She did not realize what happened to her until after the loan had closed. I relate that story because it typifies for me in terms of my experience what i have seen with consumers over and over again. That is, consumers who qualify for prime credit it steered into the subprime market, as you heard senator cardin say. The wall street journal commissioned a study several years ago in which they looked at certain vintages of subprime loans, and one of the vintages they found, over 61 of the folks who have got in subprime loans qualify for prime loans. It is our hope that this rule will help. When i think of access to safe, sound, quality credit, i think of it as a wheel with all of these spokes. The ability to pay standard and the qualified mortgage standard are two of the spokes in that wheel that are necessary to make sure we have access to affordable and quality credit. I think the rule is a very important one for us Going Forward, and i think that not only is the rule important for making sure that we are extending safe credit in the nonprime sector, but also it is an important component one of the important components to making sure that consumers to really do qualify for lower cost mortgages can get those loans. Thanks, lee said. The next question is for elise cohen with the National Consumer law center. In the context of the qualified mortgage definition in your opinion what is a rebuttable presumption of compliance meeting for consumers . Thank you. First, let me applaud the bureau for the detailed articulation of the rebuttable presumption for subprime borrowers that appears to be included in the rule. We look forward to reading it. Including the use of residuals and, as an articulate it reason for rebutting the presumptions. What is it . It is the opportunity to show that your loan was forcibly unaffordable when it was made, even if it meets the definition of a qualified mortgage. It is a chance to save your home if you can prove your case. While the qualified mortgage definition promotes more sustainable landing, there are always gaps, like there were after h. O. P. A. , and new products developed. This helps address those instances. Beyond consumers, this also relates to how the market functions. The main goal of the rule is to incentivize sustainable lending and good behavior. The limited liability steers lenders away from an affordable loans. The structure of having a safe harbor for prime loans and a rebuttable presumption for subprime loans also promote more landing in the prime space. But with that insulation of the safe harbor lenders, it will also push the envelope on abuses. They migrate to unregulated portions of the market because the homeowner has no chance to show the loan was unaffordable at inception. The rebuttable presumption will provide a more robust set of protections for the most vulnerable borrowers, those with subprime loans. Credit is tight now it is tight now because of lenders over reaching that caused the crisis, not because of any litigation risk caused by consumer claims. A rebuttable presumption leaves room for Market Recovery will also providing what is missing from the safe harbor. This next question is for david moskowitz. How do these requirements into what you think about basic Underwriting Practices . It is entirely consistent with how we think about basic underwriting. We support the bureaus establishment of consistent industry ability to repay standards. In the past, lenders were subject to different ability to repay standards or standards at all or standards that apply to only portions of the market. To many smaller players who are not invested in the long term success of their customers who either did not retain the servicing rights or did not keep the loan on their books were able to utilize underwriting standards that were not sufficiently focused on the ability to repay. The market would have been better off if underwriting standards were in the effect across the industry that were clear and there was no departure from them. So we think of ability to repay in a way that is entirely consistent with the bureaus approach and fundamental to sustainable Home Ownership. As director cordray said in the beginning, it is a of the principle that the ability to repay would result in approval only when the lender believes the consumer has the ability to repay a loan in accordance of its terms. It is underwriting 101 the ability to embrace the concept applied universally will help ensure sustainable Home Ownership and will fulfill the doddfrank requirements for enhanced underwriting. The next question is for karen thomas how are smaller institutions viewing the rule . At the outset, Community Bankers met it with anxiety. Like a lot of regulations, the regulations and the Regulatory Burden is borne on practices that Community Banks did not engage in, but then they kind of get the fallout and they enjoy, i am using that word sarcastically, the Regulatory Burden that comes along with that. I am concerned not with the ability to repay as a concept. Community banks make solid loans, that is what they do take into account the ability of their customers to repay. They are more concerned about rigidity in the regulation and their ability to be flexible and provide loans to their customers that, like i said, do not necessarily fit the cookie cutter mold. At the same time, in the runup to the financial crisis, they watched customers who would come into their banks and would not qualify for a loan that the Community Bank would make. They watched the customers walk down the street and get a loan from somebody else. Those are the kinds of loans that later on blew up and caused damage to the customers. They certainly understand the impetus for the rule. The cfpbs door has been wide open to Community Banks, and we have been grateful for that. The details in the role take into account the concerns of the Community Banks. The full rule come out later today, we look forward to reading this details. On the first look, we are encouraged by it that the concerns of Community Banks will be taken into account. As we move into understanding of the rule, Community Bankers will let us know where the sticking points are. The definition of special rules for rural lenders will be looking closely at the definition and the bankers will be looking as well to see if their operations into those definitions. Things will unfold over time. The other point i want to make is it is important to know that this rule, the qm rule, is only one piece, although arguably the most important piece of the market reforms the cfpb is working on. The other mortgage rules, loan officer compensation, and so forth, are also going to impact Community Bank mortgage operations. We have to be careful that the cumulative burden does not push some Community Banks out of the Mortgage Market. I want to give you an example. A while back, the Federal Reserve adopted an escrow requirements rule for certain mortgages. There are many Community Banks that have low mortgage volumes, and did not have an escrow operation. Now, they were required to have escrow. The could not provide that to their customers. They had to cut off the mortgage lending they could do. We want Community Banks to be able to serve their customers. I would like to take a couple of minutes to follow up on threads raised by the panelists. The multiplicity of policy initiatives under way with regard to the Mortgage Business and more broadly presumably, to live through a credit and financial crisis, a great many things have to go wrong. Undercapitalized firms. Vehicles. Funding structures. A great deal to fix. There were a number of Reform Efforts underway. This clearly does not do everything. Within that context, perhaps you might in that context, how do you view the importance of this rule about a recovery in the Mortgage Markets . It will profoundly enhance the recovery in the Housing Market in at least three ways. First, it sets an important baseline of standards for mortgages. One of the things in this housing crisis is, while many other countries have housing bubbles, the United States really stood out as having the worst quality mortgages. People were not only struck with declining house prices in the United States. They could not afford the basic mortgage itself, except for by refinancing, and what was hopefully a neverending appreciating market. It addresses that which was the core flaw in the Housing Market of the United States. Second, it provides clarity for the secondary market. Those who provide capital for mortgages have a profound effect on which mortgages are offered. It is not just a decision of the lender, or even a substantial bank itself. It is whether they can sell the loan into the secondary market. Most important, what are the risks of that . In contrast to virtually no bar were litigation coming out of this housing crisis, there have been a tremendous number of investor claims from both private investors in the government claims, socalled buyback claims, where they are able to force lenders to buy back defaulting mortgages, and absorb all the cost of them. It is anticipated that those purchasers in the secondary market will require lenders to certify that their loans meet qm standards. That is a place in the standards will have a big impact. Having the brighter line standards that cover a wide part of the market, it gives lenders the confidence, when they originated a loan, that it meets that standard, and that when they sell it into the secondary market, they are not at undue risk that they will have to buy it back. Finally, it validates the good work of the cfpb. It was a sea change in the regulatory world, and there was a good bit of fear in the industry that it would impose unreasonable proposals, and not dig into the data, into the operational concerns of consumer markets. I think, by this rule, and by the comments you heard today, that they fully did so, and produced a rule that is designed to help consumers, but also to work for industry, so there will be credit available. Thank you. Perhaps i can ask the same question to you. Is this a necessary but not sufficient condition for a return to a more vibrant mortgage lending market . What else has to happen . What are the markers that we, as market participants, consumers, and regulators should be looking at . Of course, there is more work to be done in implementation of this rule. There are also important issues in servicing rules, and of course, the qrm. We remain fully reliant on a federalized mortgage system, and we need to bring private capital back. There needs to be we need to arrive at a consensus on new structures to do so. Nonetheless, the cfpb is to be congratulated. This is a major step forward. Todays rule is a major achievement. Thank you. In the spirit of doing hard work and doing it well, and doing it on time, which should probably thank our panelists for doing this and other valuable perspectives today and throughout the process. Thank you, and we will move to the next phase of our public hearing. [applause] , now, it is time to hear from audience participants here today. I am told our audience includes community leaders, advocates, industry representatives, and of course consumers. The open mic portion of todays hearing is an opportunity for the cfpb to hear of your experiences with your mortgages, and to share your observations. Each person will have in one minute to tell their story. What we hear from you is invaluable. We want to hear from as many of you as possible. I strongly encourage you to please observe the twominute limit, so as many folks as signed up to share their observations have the opportunity to do so. With that, i would like to call up our first audience participant, marceline white. One of our staff will bring a microphone to you. Thank you for the opportunity to speak today. Members of the bureau, we appreciate you coming to the forum. I and the executive director of the maryland Consumer Rights coalition. We want fairness and justice for maryland consumers, through research and advocacy. I am also a homeowner in baltimore city. I appreciate the work the bureau has done on these rules. Home ownership is a vital avenue for wealth building, especially for low and moderate income families. We know these families use home equity to increase their assets, and to support consumer investments in their families, such as higher education. This is particularly true in communities of color. The work you are doing is important for all our families, but especially low and moderate income families. It is imperative the mortgage lending rules to balance the needs of institutions and communities. It is important it provides more access to credit, as well as clear and transparent standards for borrowers and more lenders. Our concern right now is that, as written, the rule does too much to protect banks, at the expense of working families. Our concern is that the safe harbor in the qualified mortgage rule provides too much of a legal field for Financial Institutions, and it involves the liability around the ability to repay. As the rule is to find, most mortgages will qualify as qmaheads, and will be shielded from lawsuits. This casts homeowners out to sea. We believe there should be a rebuttable presumption for all loans. It also assumes Financial Institutions have engaged in underwriting, despite clear evidence to the contrary. We understand the impetus of the rule, and the motivation. However, we know that banks and Financial Institutions should have always been engaged in sound underwriting policies, and that is not the case. We think the standards are important for consumers. But we have very strong concerns about the safe harbor provision. We are also concerned that the inclusion of the 48 debt to income ratio may price of moderate to low income families who would like to purchase loans, and would like you to continue to look at that issue. I am going to end that we simply appreciate the work you have been doing, and would like to make sure that you continue to engage people on the ground in these issues. Thank you for your comments and the work you do in baltimore. Our next audience participant is [indiscernible] my name is yanet milan. I work for the Baltimore Public School system. I am here to represent not only the latino community, but all americans who have struggled to maintain the american dream, to own a house. Actually, in your system, if you can write it down, i am [indiscernible] that is why everybody is here. I had a complaint with the agency, because i have a sub prime loan with an Interest Rate of 6. 87 . In about three years, it is going to go up to 700. I tried to obtain a loan modification, but i never was able to get that modification. And i am really happy now when that you are having your rules to prevent further abuses. Now, i am wondering what your agency is going to be doing for people like me that are still struggling to make their home payments with subprime loans. I think we live in a great country. Definitely, we are here because we can make all dreams come true if we really work hard. We are all accountable for what we do. I would like to know how your agency is reviewing and tracking all the complaints that you have. How much are you making sure you are offering a timely response . Thank you, ms. Malone. I am sure you have our staff in washington, d. C. Curiously looking up their complaint. We have your contact information, and will make sure stuff follows up with you. Thank you for your work with the Baltimore Public School system. Our next audience participant is mike warren. Do we have rod stetz . I am president and ceo of cq, here in maryland, and i am also here, on behalf of cuna. We believe this should be workable for consumers, while avoiding disruptions in the Mortgage Market based on lenders fears of increased liability, and so on. We commend your efforts on this issue. We also appreciate that the bureau is allowing temporary exemption from the qualified mortgage 43 debt to income ratio to meet the eligibility requirement. We appreciate that as well. However, we remain concerned that there may be instances where higherincome ratio may be appropriate for certain borrowers, especially for us, as we deal with our own members. And we will be closely reviewing this aspect of the final rule. Given the scope of the rulemaking pending at the agency, we want to reinforce our members concerns, and urged the agency to do all they can to contain new regulatory requirements by Credit Unions. The issues expressed by Community Bankers are the same issues we have, especially the small Credit Unions, trying to adapt to regulations. Cuny commence the bureau had and the general work with the Credit Unions. We greatly appreciate the time you have spent with us, and your willingness to listen to how we do business and how we can help our members. Nonetheless, Credit Unions remain very concerned about the broad of regulatory actions. We have had discussions, and you are well aware of those. On the part of cq, when you talk about interestonly, negative amortization, highrisk options we did not do any of those. We never did and did not plan to. As we move forward, what you are suggesting, we have been doing anyway. We want to make sure there is ample time to get it in place her in a way that works effectively. If congressman cummings were here, and the senator were here they mentioned hearings they have held. You know what we need it . Loans. All they needed to do was call us, and we would work through the situations with them. As a matter of fact, we have an Outreach Program in our news letter that said, talk to us if you are having issues, because we will work with you. That is how much we care about our members. Director cordray, last night, you made a call to bill cheyne and talked to him about this rule. We appreciate that call as you work through all of this. Will a final rule be published this afternoon . We are very hopeful. We are getting heads nodding. Thank you. Mary hunter . Joe rodgers . Edsel brown . Good afternoon. It is indeed a pleasure to be here. I am edsel brown, and i am representing the maryland state naacp. I would like to say on behalf of our membership that the mortgage issue very adversely affected our community. We had a number of workshops and hearings around the state. I cannot tell you how many stories i could relate to you about Horror Stories that people experience. We appreciate this first step you are taking to make improvements in the status quo. A, well the bright lights are shining and everybody is here, everything is looking good. But this is a first step, not a last step. We are looking to improve the process, as we move forward. I have been involved in other regulatory processes. There are always holes in the fence. There are attorneys that will find the holes in the fence. Let us make sure this is not a onetime thing over the next two or three years. I would like to mention a couple other things. One is information. Information is power. Organizations like the naacp and other Community Organizations need to get this information on the front end, not the back end. Also, partnerships. My colleagues spoke earlier, made a few comments. There has been a severe breach of trust. We have a number of consumers, who even if you reach out to them, they do not trust you. We have to build that trust back up. But again, i want to thank you for this opportunity to speak. But again, a beginning, not an end. Thank you, mr. Brown. We agree with that. Robert kerwin . Reverend gloria pardon my mispronunciation. Thank you very much. My name is pastor gloria jones. I am a member of Communities United of greater washington. I am also a sitting commissioner on the commission for persons with disabilities for the county of prince george, maryland. I also want to commend you for your very important first step toward resolving a very egregious problem, with regard to predatory lending. I myself am a predatory lending survivor. However, i am very concerned as to whether or not the protections built into your efforts are adequate enough for people who are particularly vulnerable, such as folks like myself, who are totally print disabled. One of the things i would really like to happen is to get a copy of your proposal in some audio form. I do not have immediate computer access. And unless god changes his mind, i am not going to be able to read the printed page. One concern that i do have is a safe harbor for borrowers, and i will use myself as an example. My predatory lender has been in enthusiastic violation of a modification contract signed in october of 2007, for quite a few years. I am paying almost 200 outside the agreedupon sum. I learned a couple of months ago that my predatory lender is in india. They do not even have a Standing Office in america. They have abandoned this country, taking my Insurance Coverage with it. I use that as an example, because if i were the lone ranger, that would be beyond egregious. As a member of the home defenders lee, i can tell you there are no lone rangers. There are people whose disability is age. I am 75. There are people whose disability is lack of the information. My point of encouragement the banks already have more protection than we do. In every single hopeful sign, when it finally blossoms into reality, the bank is better protected than the borrower. At some point, we have to arrive at a situation where somebody who is going through the types of experience i am having and i am in a discussion with your organization has somewhere to go with totally egregious, predatory, criminal, and literally extortionist activities, where you are talking about the roof over your head, can be adequately addressed. In a safe harbor concept, we need to see a safe harbor that adequately extends access to sufficient protection over the bar were, or down the road, we are going to find the fox is back in the henhouse. We are going to be hemorrhaging houses again. In neighborhoods, families, and society will again be experiencing the trauma of a housing shortage. Thank you. Can you please gather her contact information, so we can be responsive to her request . Thank you for the work you do. We hope you can continue to carry it out for many years to come. Douglas kraus . Robin ayele . There we are. Robin ayele . I am with baltimore neighborhoods. I want to know how will you ensure that borrowers will be able to get loans in the future . And low interest loans those that deserve them get low interest loans . Does staff want to take that . Underserved borrowers. Todays rule should both increase confidence in the Mortgage Market, so that lenders feel more ability to lend, and consumers can feel more ability to look for loans and go to the closing table without being set up to fail. In both respects, having a stronger market with better Consumer Protections is good for lenders and for borrowers. It should be good for the market. In terms of how the market will evolve over time, we are just going to have to see. We do not control all of those details. We cannot mandate that a lender lend to any particular consumer. We can just set up the right framework, to root out the kind of reckless lending abuses that were in demint before the crisis. We believe that having done so, we will open up the responsible banks and community lenders, some of the nonprofit groups and others, and the main lending community, to be more confident to lend, and that the market will support that, and they will not have to compete against some of the deceptive, abusive, misleading types of loans that they were competing against. We will just have to see how the market evolves from here. Thank you. Terry hunt . Good afternoon. My name is carrie hunt. I am with the National Association of federal Credit Unions. I hope we have some members here today. Excellent. As you know, Credit Unions are charged with providing credit to this country. It is something that congress had specifically told us that we need to do. And i think that is a shared goal we have with the cfpb. I want to thank director cordray and all the cfpb for allstaff for all the work you have done on this job. All my job is to make sure our Credit Union Members of rules they can live with, they can work with, that really help them do their job in lending to consumers. And as i have worked with your staff, we have expressed concerns, and we have tried to express why we need a rule making that is effective. I hope that as we move forward, you really can take a hard look at the regime that has been created, and if it looks like Credit Unions cannot land, but rules are too restrictive, that consumers who qualify, who have the ability to repay loans, are not getting them, that we take a second look at what this country is doing. I would certainly hope that the cfpb will partner with us in making sure that does not happen. We really appreciate that you asked for comments on Credit Unions and small banks, to make sure we can land. Hopefully, we will continue to do what we do best as we move forward, which is what Credit Unions really want to do. Thank you. Kathleen smolnee . Thank you for taking my comments. Those of you who know me, know that i do not usually need a microphone. I am glad to be here in the baltimore community. I am a practicing attorney in maryland. I have represented homeowners in mortgagerelated claims for a dozen years. I have recently retired from legal aid. I was also be pleased to be part of the Governors Task force, which resulted in protections in the statutory foreclosure process. I was also on the committee that revised the court rules. I would really like to comment on my concerns over the safe harbor, and specifically join the reverend in her concerns. We are told today that the safe harbor is necessary as an incentive to sort of kickstart or break open, if you will, the Credit Access that is so bottled up. We have also heard that this is a result the whole meltdown was the result of reckless assumptions. What borrowers did had very little to do with where we ended up. We are glad to see we are finally getting some regulation related to this. Back when the earth was cooling, i was a securities broker. Back when 60 million shares was a good day, and securitization actually made sense. What i would like to express the concern of my colleagues who practice in this area that if there is a safe harbor, such as in this rule, that it be subject to simple rebuttal. The rebuttable presumption, limited to the subprime borrowers, really makes no sense. All borrowers are entitled to affordable mortgages. A mortgage be an affordable should be subject to a broad rebuttable presumption, not a nearly absolute presumption. By the way, maryland has an affordability statute, and our workers did not have to relinquish their rights to the court to get that. We would like to see the rebuttable presumption, broadened to all borrowers. Thank you for your comments. John sullivan . Good afternoon, and thank you very much for the opportunity. I and john sullivan, from the buyers edge, and former president of the association of buyer agents. In your prepared remarks, you referred to responsible lending. I applaud your efforts on instituting reasonable legislation. You also referred to reckless lending practices because of the foreclosure crisis. In the vast majority of those cases, it was a realestate agent who should have known the home buyer did not have the ability to meet his or her financial commitments. The realestate agent or broker, like the lenders loan officer, got a commission, and has not been seen since. Unfortunately, the doddfrank bill prohibits your action against brokers. Is there anybody at your bureau who has enough wherewithal to stand up to lobbying efforts, to ask congress to eliminate those provisions from the dodd frank bill, and require the realestate community to make the consumer aware of their agency choices, when selecting an agency to guide the consumer through the maze of home buying . At the present, there are 50 state regulations, none of them alike, some of them calling the same type of agency a different name. We need some regulation at a National Level on Agency Disclosure to make sure the consumer is protected when they are making the biggest purchase of their life. Thank you, mr. Sullivan. Allyson wang . I am interested consumer. I would like to know a trend in the employment market is the increasing percentage of the population whose income mimics the selfemployed, whether they are our workers, independent contractors, or freelancers. What protections does the rule offer in the burden of proof of ability to repay for those workers who may not fit the traditional model of a 40hour work week, salaried employee, or tenured employee . There are provisions for creditors to consider income, so verifying documentation is important, making sure verify information is used in any debttoincome determination. Selfemployed borrowers are a big segment in the market. The rules we are putting forth to provide guidance for how selfemployed borrowers should be considered. They should not be locked out of the market. They are factored in to the guidance we provide, both in the ability to repay, and the qualified mortgage standard. Thank you, ms. Wang. I was not in washington when doddfrank was fiercely lobbied over. I know it was, and there were a number of exceptions written into the law, with the extent that the exemptions are complex. I am sure, down the road, there will be further consideration in congress. But i want to point out that one important feature that is new is that the Consumer Bureau is now in place to oversee not only Financial Institutions that have a charter, as was true before doddfrank, but also nonbank mortgage lenders. That is important. You cannot have a satisfactory or successful regulatory scheme that covers part of a market and leaves the rest uncovered. What you find is what was noted on the panel people going down the street and getting irresponsible loans from people who are not subject to any standards, and that are cutting into the market for responsible lending. The fact that this rule is still in place, and covers most of the mortgage lending market, i think is a notable step forward. Thanks for the comments. Our last audience participant is vicki taikano. Thank you all for joining us today in baltimore on the cfpb field hearing on the ability to repay. What we hear from you all, the wide array of interest represented here, is very important. We listened very carefully. We thank you for taking time from your day to talk to us. [applause] [captioning performed by national captioning institute] [captions Copyright National cable satellite corp. 2013] next, q a with author jason cornyn. Live at 7 00 a. M. , your calls and comments on washington journal. Today, the House Rules Committee considers amendments to the Hurricane Sandy Disaster Relief bill. The Senate Passed a bill providing 60 billion in aid. The house has only approved part of the legislation. You can see the Committee Hearing live at 5 00 p. M. Eastern and cspan2 on this week on q a, Jason Brennan discusses his book, libertarianism what Everyone Needs to know. It was back in a high school class. My economics teacher recommended i read this book called, economics in one lesson. The idea was to not just look at the intended consequences of the political policy but look at the unforeseen consequences on the side. That was a transformative moment for me. It came down to one High School Teacher showing the one book. What did you do from then on . It has always been an interest of mine. I started reading john locke and karl marx. I had not encountered i did i had not encountered i did not realize john locke was a