The senior lender at ABC bank would like to make stated income mortgage loans (i.e., loans where the bank does not verif
Posted: Tue Mar 08, 2022 10:44 am
The senior lender at ABC bank would like to make stated income mortgage loans (i.e., loans where the bank does not verify the applicant"™s income) to mortgage customers, including subprime borrowers. Under the statement on subprime mortgage lending, which of the following is the best statement of the bank"™s responsibility regarding this new program?
A. Due to the risks, it should not implement such a program for subprime borrowers
B. The bank should make a policy for this program that includes mitigating factors for the risks
C. The bank should set stringent debt-to-income ratios for these loans
D. The bank should establish workout procedures for such loans in advance of making them.
A. Due to the risks, it should not implement such a program for subprime borrowers
B. The bank should make a policy for this program that includes mitigating factors for the risks
C. The bank should set stringent debt-to-income ratios for these loans
D. The bank should establish workout procedures for such loans in advance of making them.