Federal Mortgage Law · 24% of the SAFE exammedium
Correct answer: The loan's APR must not exceed APOR by 2.25% or more for most first-lien loans
Under the CFPB's revised General QM rule (effective March 2021), the hard 43% DTI cap was replaced with an APR-to-APOR comparison. Specifically, a first-lien loan qualifies as a General QM if its Annual Percentage Rate (APR) does not exceed the Average Prime Offer Rate (APOR) by 2.25 percentage points or more for most loan amounts. APOR is a benchmark rate published weekly by the CFPB reflecting average rates for prime-quality mortgage loans. The borrower's DTI must still be considered and verified, but there is no fixed DTI ceiling. "The LTV must be 80% or less" (80% LTV) and "The borrower must have a credit score of 620 or higher" (620 credit score) are common underwriting guidelines but are not General QM requirements.
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