Wednesday, September 20, 2006

Borrowers don't understand exotic mortgages,

too little and too late!

wer zu sp├Ąt kommt den bestraft.........


U.S. REGULATORS TO ISSUE GUIDANCE ON EXOTIC LOANS SOON

U.S. BANK REGULATORS SEEK IMPROVED MORTGAGE DISCLOSURES

BORROWERS DON'T UNDERSTAND EXOTIC MORTGAGES WELL ENOUGH

Homeowners don't fully understand the risks of alternative mortgages that allow interest-only payments or negative amortization, federal officials told senators on Wednesday. At a hearing on exotic mortgages at the Senate Banking Committee, federal banking regulators promised they would soon release guidance to lenders that would require greater disclosures to borrowers and recommend tighter credit standards for such loans. Sandra Thompson, acting director of supervision and consumer protection at the Federal Deposit Insurance Corp., said exotic loans have mushroomed in the past few years, especially in states with soaring home values. "Borrowers may not be well-informed about the risks," said Orice Williams of the Government Accountability Office

jan-martin

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