The new rules from the Consumer Financial Protection Bureau released on Thursday, January 10, 2013, were meant to make make it safer for potential homeowners to obtain a mortgage. This would be done by prohibiting lenders to issue mortgages to those who are unable to prove that they can repay their loans. But, does this new rule benefit lenders more than it helps potential homeowners? As this article mentions, “Lenders will still be able to issue loans to people in which mortgage debt can compromise as much as 43% of their pre-tax income.”
Forty three percent?! That is an unbelievably high rate. And with this new rule, a buyer would not just be left with the inability to make their mortgage payment, but also with the inability to sue their lender.
Read more about these new rules HERE.
What are your thoughts about the new rule? Who do you think it benefits?