Fed Taking on Abusive Lending Practices
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.