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Predatory Lending Prevention and Fair Lending

13 minPRO
2/6

Key Takeaways

  • Predatory practices include loan flipping, equity stripping, excessive fees, and negative amortization without disclosure.
  • Fair lending prohibits both disparate treatment (intentional) and disparate impact (unintentional but disproportionate).
  • Seller financing is exempt from ATR/QM only for 3 or fewer properties per year with specific structural requirements.
  • Exceeding seller financing exemption limits triggers full lending regulatory compliance obligations.
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Test Your Knowledge

1.What is operational risk?

2.What is a risk register?

3.What is the Recovery Time Objective (RTO)?