Federal Reserve Reveals Plan To Curb Risky Lending

Law360, New York (December 18, 2007, 12:00 AM EST) -- In response to the crisis spawned by subprime mortgages, the Federal Reserve proposed new rules on Tuesday that would tighten loan requirements for “higher-priced mortgage loans.”

The rules are meant to stop unscrupulous lenders from persuading would-be buyers to take on loans that should be out of their reach but also to protect consumers from overestimating their own ability to shoulder debt, the Federal Reserve said.

“Our goal is to promote responsible mortgage lending, for the benefit of individual consumers and the economy. We want consumers...
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