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Misfit Borrowers Attracting Lenders as Housing Revives

Raj Date helped write new rules for U.S. mortgage underwriting as deputy director of the Consumer Financial Protection Bureau. Now he’s building a company that will offer loans to borrowers blocked by the agency’s standards.

Date, 42, left the CFPB in January to found Washington-based Fenway Summer LLC, which plans to provide loans, including interest-only financing, to borrowers he considers low risk even though they might carry debt that exceeds the agency’s threshold. He estimates that nonqualified mortgages make up as much as $1.5 trillion of the $10 trillion home-loan market.