Fed Proposing regulations for the Mortgage Industry!
"Consumers say the Regulations (as proposed in December) still leave too many loopholes for reckless lending to continue"....... Lenders say: " the proposals are too tight and will prompt them to further restrict credit"!
WHO RIGHT?
Keep in mind they're talking about "future" lending practices, not the guys who are already in trouble!
Here are the Rules proposed:
· Require Lenders to verify Income and Assets
· Prohibit them from engaging in a "pattern of practice" of making loans borrowers can't afford
· Limit Prepayment penalties
· Require escrow accounts for Taxes and Insurance
· Prohibit banks to pay Brokers unless compensation is disclosed
· Prohibit Brokers from coercing Appraisers into misstating a homes value!
Where do I start? There's no queston the Industry needs to be cleaned up. In my mind they should come up with "specific" rules not ones left to interpretation (which is how it is now)! Then whoever breaks the rules get prosecuted to the max! At least 10 years in prison in my mind!
"Brokers" are not the issue, "Brokers that break the rules" are the issue. Brokers keep the market competitive! I also think the consumers need to wake up. Get three bids from "lenders" you've been referred to (quit calling those late night "our rates at 4% guys", they should go to jail for life by the way!) and you will cut out most of the crap!
If the rules are too loose the Consumers will still be hurt and if they are too tight a lot of people won't be able to get a loan. It's definitely "ugly" out there!
John
Comments
Change happens and nobody will like these changes. Tighter standards means more people will slip through the process.(Back to renting?)
Tim
David Power
Expert in Hypnosis, Success Thinking and Practical Parenting
interestingly enough the other thing is to consider where you are living and what is actually MORE than you need.
With our current lifestyles, we require a lot more SPACE and STUFF than our parents.
I'm predicting marriage relationships will increase.
all the best,
April Braswell
Singles internet Personals Dating Advice and Tips articles
With all the craziness I'm glad I don't own a house. But I do wonder...how will all these changes affect the rentals market?
Jennifer Skinner
Wardrobe Planning Expert
John,
Creditors are bracing right now. My main bank has moved back to the old regulations requiring that the home purchaser have 20% of the home's value in the bank and available should they need it. Crazy!
Michael Christian Neumann
Six Sigma and Lean Consulting
It seems to me the mortgage industry needs to be cleaned up in most of Europe too...
Yann
Yann Vernier - Personal Coach
Aaron