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“New” Lending Rule: Borrowers Must Be Able To Repay

Friday, January 11, 2013 - 12:41 PM
In a stunning example of common sense being legislated: 
The Consumer Financial Protection Bureau (CFPB), issued a rule this week telling mortgage lenders not to lend to people who can’t pay them back.   [...] While the entirety of this rule  could be chocked [sic] up to good old-fashioned common sense, there is one part we are especially pleased to see: lenders may no longer use teaser rates to mask the true cost of a loan.

The article also includes a list of banks that were operating under orders to perform mortgage reviews and have agreed to an $8.5 billion settlement. $3.3 billion is slated to go directly to the 3.8 million borrowers who faced foreclosure.   If your home was in any stage of foreclosure in 2009 or 2010 and was serviced by any of the first ten banks listed below, you may be eligible for compensation due to a servicing error.

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4
pearlbrownpearlbrown1,436 posts since
Nov 2, 2010
Rep Points: 6,264
1. Friday, January 11, 2013 - 5:52 PM
I love the apparent contradiction in the statement from the CFPB. Don't lend money to anyone who can't pay you back, but make sure you compensate those borrowers who defaulted on their loans in 2009-10. I think actions speak much louder than words. From what I can tell, many people who couldn't pay back their loans were rewarded quite nicely.
1
loulou544 posts since
Aug 3, 2010
Rep Points: 3,397
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