Consumer Financial Protection Bureau Implements 'Ability to Repay' Regulations for Covered Mortage Loans


It is a widely understood that loose underwriting standards and practices by some creditors – including their abject failure in some instances to confirm their borrowers’ ability to repay mortgage loans – contributed in large measure to the mortgage crisis in 2008 that led to the nation’s most serious recession since the Great Depression.

In response to this crisis, Congress enacted several significant pieces of legislation, including the 2010 Dodd- Frank Wall Street Reform and Consumer Protection Act (the Dodd- Frank Act). To combat loose underwriting standards, the Dodd-Frank Act included certain ability-to-repay requirements applicable to virtually all closed-end residential mortgage loans, which were adopted primarily as amendments to the Federal Truth in Lending Act (the TILA). The Dodd-Frank Act amendments to TILA also contained presumptions of compliance with the ability-to-repay standard for certain qualifying mortgage loans.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Shumaker, Loop & Kendrick, LLP | Attorney Advertising

Written by:


Shumaker, Loop & Kendrick, LLP on:

Popular Topics
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.