Fed Adopts New Mortgage Rules to Protect Consumers

The Federal Reserve adopted new standards that ban yield spread premiums on mortgages, a practice that critics say led to homebuyers being saddled with unfairly high mortgage rates.

The premiums involve lenders paying a bonus to mortgage brokers who brought them customers willing to pay high-interest rates on loans, The New York Times reported. Critics say this practice led to brokers forcing high-interest loans on borrowers, telling them it was the best deal they could get.

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