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\f0\fs24 \cf2 \cb3 (Image source: {\field{\*\fldinst{HYPERLINK "http://www.consumerfinance.gov/"}}{\fldrslt
\cf4 \ul \ulc4 Consumer Financial Protection Bureau}})\
\ \pard\pardeftab720
\b \cf2 BY STEVEN SPARKMAN\ ANCHOR JAMAL ANDRESS
\b0 \ \
The Consumer Financial Protections Bureau issued new mortgage rules Thursday to help
cut down on risky lending.\ \
The rules require lenders to verify that borrowers can actually repay their loans. \'93Teaser\'94
interest rates are a thing of the past, as are \'93Low-Doc\'94 loans, or loans with few
or no background and credit checks.\ \
The biggest change comes in the form of a new class of loan, the strict new \'93qualified
mortgage.\'94 {\field{\*\fldinst{HYPERLINK "http://www.bloomberg.com/news/2013-01-10/lender-review-of-borrowers-tightened-under-mortgage-rules.html"}}{\fldrslt
\cf4 \ul \ulc4 The Bureau\'92s director told Bloomberg}} recent history shows tight new
standards are necessary.\ \
\b \'93We know that we had a problem in the last decade that led to a tremendous financial
crisis in this country. And the problem was caused by reckless lending, and the reckless
lending was bad in the end not just for lenders but for borrowers.\'94
\b0 \ \
A \'93qualified mortgage\'94 is one where the borrowers credit, income and assets are
all assessed before the loan is signed. Both borrowers and lenders get extra legal protection
if a loan qualifies.\ \
The new rules are getting mixed reviews from industry experts: praised for reinforcing
common sense measures, criticized for things it missed. But analysts are all able to agree:
it\'92s going to be much harder to get a loan than it was 5 years ago. (Via {\field{\*\fldinst{HYPERLINK
"http://www.washingtontimes.com/news/2013/jan/10/banks-applaud-new-mortgage-rules/"}}{\fldrslt \cf4 \ul \ulc4 The Washington Times}}, {\field{\*\fldinst{HYPERLINK
"http://blogs.wsj.com/developments/2013/01/10/new-mortgage-rules-the-reviews-come-in/"}}{\fldrslt \cf4 \ul \ulc4 The Wall Street Journal}})\
\
\b \'93Everybody knows that the lending environment was far too loose. Anybody could walk in seven
years ago. You didn\'92t have to prove any income, it was a no-doc loan, you could probably
get it with no down payment.\'94 \b0 ({\field{\*\fldinst{HYPERLINK "http://money.cnn.com/2013/01/10/real_estate/qualified-mortgages-cfpb/"}}{\fldrslt
\cf4 \ul \ulc4 Video via CNN}})\ \
There are a few common complaints about the rules, like that they may be too strict. {\field{\*\fldinst{HYPERLINK
"http://business.time.com/2013/01/10/new-mortgage-rules-protection-from-banks-or-ourselves/#ixzz2HcR763fC"}}{\fldrslt \cf4 \ul \ulc4 A writer for TIME}} thinks
the Bureau is trying to shoehorn all mortgages into one box.\
\
\b \'93[N]on-traditional mortgages still make sense for a homebuyer who, say, has relatively
little income but will collect a windfall in a few years. One size does not fit all.
Exotic mortgages have their place, small though it may be.\'94
\b0 \ \
The rules aren\'92t expected to do the housing market any favors, especially since first-time
homebuyers are the biggest movers in the market, and also the most likely to be denied a loan
under the new rules.\ \
\pard\pardeftab720 {\field{\*\fldinst{HYPERLINK "http://www.cbsnews.com/8301-505145_162-57563322/new-mortgage-rules-are-step-forward-for-housing/"}}{\fldrslt
\cf4 \ul \ulc4 A writer for CBS}} paints a pretty grim picture of the market, damning
it with faint praise by saying:\ \
\pard\pardeftab720
\b \cf2 \'93The good news is that homes in the U.S. are nearly as affordable as they've
ever been. If we have to actually be able to afford our homes, it's a good thing they
cost less than they used to.\'94 \b0 \
\ The rules are scheduled to go into effect
in January of 2014.}