On April 19, pursuant to Section 1411 of the Dodd-Frank Act, the Fed released a proposed rule under Regulation Z requiring creditors to determine a consumer's ability to repay a mortgage before making a loan and to establish minimum mortgage underwriting standards. The proposed rule provides creditors four options to comply with the "ability-to-repay" requirement of Section 1411: (i) general compliance with underwriting standards; (ii) "qualified mortgages" with creditor protections from liability; (iii) balloon-payment mortgages for rural or underserved areas; and (iv) refinancing of risky "non-standard mortgages" into stable "standard mortgages". Comments must be submitted by July 22. Fed Release. Proposed Rule.