A borrower's income includes $3,000 monthly base salary, $500 monthly overtime (worked consistently for 18 months), and $800 monthly rental income from a property owned for 6 months. Under ATR requirements, what income can be considered for repayment ability?
Correct Answer
B) $3,500 (base salary plus overtime)
Under 12 CFR 1026.43(c)(2)(i), creditors must verify and consider income that is reasonably expected to continue. The 18-month overtime history demonstrates stability, but rental income from only 6 months of ownership lacks sufficient history to be considered stable income for ATR purposes.
Why This Is the Correct Answer
Under 12 CFR 1026.43(c)(2)(i), creditors must verify and consider income that is reasonably expected to continue. The 18-month overtime history demonstrates stability, but rental income from only 6 months of ownership lacks sufficient history to be considered stable income for ATR purposes.
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