Final answer:
The ATR standards include a threshold for DTI ratios, usually not exceeding 43%, but do not have a strict minimum for residual income, which is more relevant in VA loans.
Step-by-step explanation:
The question pertains to the Ability-to-Repay (ATR) standards, which creditors must consider under the Truth in Lending Act (TILA) and its implementing regulation, Regulation Z. The ATR standards do indeed have a threshold for debt-to-income (DTI) ratios, typically not to exceed 43%. However, the standards are flexible depending on the type of loan, and there is no strict minimum requirement for residual income. Residual income is considered more in Veteran Affairs (VA) loans than with conventional loans. The focus is on ensuring that borrowers have the financial capability to repay their loans, and DTI ratios and residual income are just part of that overall assessment.