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.