The Consumer Financial Protection Bureau released its final rules restricting fees and lump-sum payments for certain high-cost loans on Thursday.
The new rules ban certain feeds on modifying high-cost loans, and cap late fees at 4% of the payment that was missed, as well as bar creditors from attaching balloon payments to high-cost loans. The regulations finalize a July 2012 proposal.
"Today's changes will better help consumers to understand the real costs of owning a home while protecting them from harmful practices that can trap them into high-cost mortgages," CFPB Director Richard Cordray said in a press release.
"The protections for high-cost loans originate from the 1994 Home Ownership and Equity Protection Act. The rules not only implement Dodd-Frank Act provisions that strengthened the HOEPA restrictions but also those expanding the universe of high-cost loans subject to the protections," writes American Banker's Joe Adler.
For the full piece see "CFPB Imposes Fee Limits for Higher-Cost Mortgages" (may require subscription).
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Comments (1)
Chalk up another win for Mr. Dodd and Mr. Frank and chalk up [another?] loss if you are a subprime borrower that wants to buy a house for your growing family.
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