Finance
The 'ability-to-repay' rule under Dodd-Frank requires lenders to:
AGuarantee that all borrowers can repay their loans
BMake a good-faith determination that the borrower has the ability to repay the loan based on verifiable information✓ Correct
CLimit all loan terms to 30 years or less
DRequire a 20% down payment on all residential loans
Explanation
The ability-to-repay rule (implemented by the CFPB under Dodd-Frank) requires lenders to make a reasonable, good-faith determination that each borrower can repay the loan. This is based on verifiable income, assets, credit, debt obligations, and other financial factors.
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