Fed Seeks Comment on Mortgage Underwriting Rule
Wednesday, April 20, 2011
The Daily Transcript -- The Federal Reserve this week requested public comment on a proposed rule that would establish minimum mortgage underwriting standards, and require creditors to verify a would-be borrower's ability to repay a mortgage before extending a loan.
The rule is proposed as a revision to Regulation Z, which implements the Truth in Lending Act (TILA) and is pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act.
This rule, if implemented, would be in addition to previous Regulation Z rules that went into effect on April 1, setting compensation regulations for loan originators.
... Mark Riedy, executive director of the Burnham-Moores Center for Real Estate at the University of San Diego, said the new regulations would cost consumers time and money in the mortgage market.
“I’m pro-consumer, but you don’t need new rules to (protect consumers),” he said. “You just need to enforce the rules that are already there.” (Full Story)