Bankers may soon find themselves unwilling monitors of a new law designed to protect consumers from lead poisoning.

Under the law, sellers must disclose the lead content of any home constructed prior to 1978 before it is sold, rented, or refinanced. The Residential Lead-Based Hazard Reduction Act of 1992 kicked in last month, coveting federally owned homes. All dwellings will be subject to the law next October. There are about 57 million single-family homes built before 1978. While the seller is responsible for testing the paint, a lender could inherit accountability if it forecloses on the property.

Judah Bernstein, vice president of Chemical Bank, said bankers will have to require copies of the lead test documentation. "Lenders will be like policemen,"he said.

But he also said it's too early to say how big this record-keeping burden will be. "The major lending organizations are still feeling their way," Mr. Bernstein said.

Mark Greitzer, president of Pro-Tect Expert Lead Testing Services in Oyster Bay, N.Y., said he expects bankers to comply because the risks are high while prevention is cheap. "The lenders we talk to know they have to establish a protocol for this," he said

Not only could regulators enforce the requirement, but banks could find themselves in lawsuits from parents whose children get lead poisoning, according to Mr. Greitzer. Chemical's Mr. Betastein agreed.

"All the institutions will wake up real fast once one gets involved in a damage suit," he said.

A lead test, which costs about $350, shoots a beam of radiation through the walls of a home to reveal if paint on the walls has lead in it

Although lead was banned from paint in 1978, it continues to be a problem in older homes. Children are most susceptible to lead poisoning, which can happen if they eat lead paint chips or even breathe lead dust. In 1992, Congress found that three million American children had some level of lead poisoning.

There have been several extreme cases where lead has been so prevalent in a home that the borrower has abandoned it, leaving the lender responsible, said Mr. Greitzer. But he said most lenders won't get into trouble on this issue. "If they put a proper lead program in place, they have nothing to worry about," he said.

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