Finance
What is the 'Dodd-Frank Wall Street Reform and Consumer Protection Act' and its impact on Idaho mortgage lending?
AA state Idaho law governing mortgage licensing
BFederal legislation enacted after 2008 that created the CFPB, established ability-to-repay rules, and reformed mortgage lending practices nationwide✓ Correct
CA law specific to commercial real estate only
DA law that reduced lending regulations
Explanation
The Dodd-Frank Act (2010) created the Consumer Financial Protection Bureau (CFPB), mandated ability-to-repay requirements, defined 'Qualified Mortgages,' restricted prepayment penalties, and overhauled mortgage disclosure requirements to protect borrowers.
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Key Terms to Know
Adjustable-Rate Mortgage (ARM)
A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
State-Specific Concepts
Disclosure Requirements
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