Regulators issued new mortgage rules last week designed to prevent a return to lending practices that helped crater the housing market and brought the financial system to its knees during the past decade.
Here’s a look at some frequently asked questions:
What is a qualified mortgage? Congress amended federal lending laws in 2010 to give greater legal rights to borrowers who get mortgages they can’t afford. The new law, part of the Dodd-Frank financial-regulation overhaul, said if banks made a qualified mortgage — one that meets certain easy-to-identify criteria — regulators and courts would presume lenders had reason to assume a borrower could repay.