Washington, D.C. – Attempting to solve problems such as access to mortgage credit and assessing the ability to repay, Consumer Federation of America commissioned the Center for Financial Services Innovation to conduct research exploring the development of a residual income model.

This model could be used in mortgage underwriting, in conjunction with other tests, to assess ability to repay in a standardized way that balances the desire to expand mortgage credit with the desire to do so in a way that is beneficial for both borrowers and lenders.