Senate Approves Financial Reform Bill
As far as buying a home goes some changes that this bill will create are:
- Limits how lenders can penalize borrowers for paying off their loan early (prepayment penalty).
- No more stated loans…that’s where the lender trusts you to tell them the truth about your financials without proof in exchange for a higher interest rate.
- Lenders and brokers won’t be allowed to push borrowers to accept loans with higher interest rates or with risky features…I’m curious how they are going to govern this, but whatever…
I think these are some good changes in theory, but I will be curious how they play out. I know there has been a lot of negative publicity for stated loans, but they have been helpful to a lot of people, particularly self employed borrowers. Read the article in NYT HERE