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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (72384)	12/16/2007 12:39:48 AM
From: RWS	Read Replies (2) \| Respond to of 116555

MISH, I've been reading your blog for a while and you have educated me to the point that I found the article below hilarious. RWS Fed Taking on Abusive Lending Practices Saturday December 15, 4:48 pm ET By Jeannine Aversa, AP Economics Writer Federal Reserve Officials Plan Steps to Crack Down on Shady Mortgage Lending Practices WASHINGTON (AP) -- People taking out home mortgages may gain new protections soon against shady lending practices as the Federal Reserve seeks to back even the riskiest borrowers, already hit hardest by the housing and credit crunches. Rules expected to be proposed Tuesday would apply to loans made by all types of lenders, including banks and brokers. The plan from the Fed, which has regulatory powers over the nation's financial system, could be finalized next year. The effective date would be know then. The Fed is considering: --barring lenders from penalizing subprime borrowers -- those with spotty credit or low incomes -- who pay their loans off early. --forcing lenders to make sure that borrowers, especially subprime borrowers, set aside money to pay for taxes and insurance. --restricting loans that do not require proof of a borrower's income. --examining lenders' failure, in some cases, to consider a borrower's ability to repay a home loan. --improving financial disclosure so people better understand the terms and conditions of their mortgages and get this information when it is most useful. --curtailing abuses in mortgage advertising. "We have an obligation to prevent fraud and abusive lending," the Fed chairman, Ben Bernanke, said earlier this year. "At the same time, we must tread carefully so as not to suppress responsible lending or eliminate refinancing opportunities for subprime borrowers.'