Calhoun Statement on Release of FRB Rules (revised 7/23/08)
(Revised July 23, 2008) Today the Federal Reserve helped return the home lending industry to common-sense business practices by issuing new rules for mortgage lenders. We are pleased to see that the Fed has adopted key protections for borrowers who receive subprime loans, including: Addressing the most substantial cause of current foreclosures, lenders must carefully evaluate a borrower's ability to repay a subprime loan, and verify the income used to do so; Lenders cannot impose abusive prepayment penalties that trap borrowers in short-term subprime ARMs; Lenders must escrow for taxes and