A lender can make a higher-priced mortgage loan based on the value of the consumer's home without verifying the consumer's ability to repay the loan.

Question

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The Ability-to-Repay rule requires lenders to verify a borrower's ability to repay a mortgage loan before making the loan, even if the loan is a higher-priced mortgage loan based on the home's value. Therefore, lenders cannot make such loans without verifying the borrower's ability to repay.

A Lender Can Make a Higher-Priced Mortgage Loan Based on the Value