Monday October 20, 08:53 PM
US Fed finalizes rule on mortgage rate disclosure
WASHINGTON, Oct 20 (Reuters) - The Federal Reserve Board on Monday approved final rules that require mortgage lenders to notify borrowers of the interest rate difference between between higher priced mortgage loans and comparable prime mortgages in many cases.
The new Regulation C rules will require the disclosures to prospective borrowers if the the rate spread between prime and subprime loans is equal or greater than 1.5 percentage points on a first-lien loan or greater than 3.5 percentage points on a subordinate-lien loan.
The spread will be based on prime loan offer rates in Freddie Mac (NYSE: FRE - news) 's Primary Mortgage Market Survey.
The Fed said in setting the rate-spread disclosure threshhold, it sought to require disclosures for subprime mortgages and avoid comparisons for prime mortgages.
(Reporting by David Lawder; Editing by Diane Craft) Keywords: FINANCIAL/FED MORTGAGES
David Lawder
vj
COPYRIGHT
Copyright Thomson Financial News Limited 2007. All rights reserved.
The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
NNNN
|
|
|
Send Article by Email
Send Article by IM
Blog This with Y! 360
Printable View
