Mortgage Lending: 7.2.6.2.4 Dodd-Frank standards of affordability for nontraditional mortgages
Interest-only and negatively amortizing loans are not generally eligible for any presumption of affordability under the Dodd-Frank Act ability-to-repay rules.303 The CFPB underlined its basic skepticism about the affordability of these nontraditional mortgage loans by allowing eased requirements for measuring a borrower’s ability to repay when a new creditor is refinancing an adjustable rate, interest-only, or negatively amortizing loan into a fixed rate, fully amortizing mortgage.304 In oth