If a QM loan is not protected by Safe Harbor, what could a consumer do?

A Qualified Mortgage (QM) loan is designed to meet certain criteria to protect consumers, including the ability to repay (ATR) requirement. When a QM loan is not protected by Safe Harbor, it means that the lender is not afforded the same legal protections regarding compliance with ATR standards. This creates an opportunity for consumers to challenge the lender's practices if they believe the loan does not meet ATR requirements.

By choosing to challenge the lender in court, consumers can assert that the lender failed to ensure the borrower could reasonably repay the mortgage under the agreed terms. This option underscores the legal recourse available to consumers who may be placed in precarious financial situations due to non-compliance with the ATR by the lender.

Consumers could certainly take other actions such as filing complaints or reporting lenders to regulatory bodies, but the most direct action regarding the loan's compliance with ATR requirements is to challenge it in court. This highlights the seriousness of ATR standards in protecting borrower interests and the rights consumers have when those standards are not met.