Learn more about the Mortgage Choice Act and how it will affect you
By Jason Boone
The Mortgage Choice Act was recently passed by the U.S. House of Representatives on June 10 and everyone from the National Association of Realtors (NAR) to top listing agents across the United States applauded its passage but is this bill ultimately good news for consumers?
What Is The Mortgage Choice Act?
The Consumer Mortgage Choice Act is a new piece of legislation that seeks to undo or undermine the recent ability to repay Dodd-Frank provision, a piece of legislation that was created in response to the recent Real Estate crash that resulted in millions of foreclosures and short sales across United States.
Under the Ability to repay provision, lenders are required to determine if a borrower has the ability to repay a mortgage before they offer a mortgage loan to the borrower.
A Real Estate Market without the Ability to Repay Provision
Without real mortgage standards in place, it’s possible that many lenders across United States will once again steer borrowers into mortgages that are designed to fail.
Unless more is done to keep mortgage standards in place it’s likely that we will see the same conditions occur once again in the Real Estate market which caused the recent crash of the housing market.
How Lack of Mortgage Standards Affects You
Thanks to the Dodd- Frank Acts Ability To Repay Provision home buyers across the United States were protected from high interest mortgage loans since the Dodd-Frank Provision set Fees and Points on Mortgage Loans so that were required to amount to no more than 3% of the original loan amount.
The reality is that only time will tell if borrowers have really learned their lessons from the mistakes that they made when they fell prey to bad mortgage loans that they signed before the housing crisis or if they will once again make the same mistakes as before.
What are your thoughts? Feel free to leave me a comment!
To learn more about the latest Real Estate news or to view Bend homes for sale contact me, Jason Boone Principal Broker at Duke Warner Realty | Skjersaa Group by calling me at (541) 383-1426 or by emailing me at Jason@sgbend.com.
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