The Treasury Secretary tells NPR that the government will prevent future lending “abuses” by increasing regulation and disclosures in the Mortgage Business.
A mortage already comes with so much paper it requries a lawyer in most states. Be honest, when you got your last mortgage, did you really read all the fine print?
If your mortgage came with a disclosure saying the lender was a criminal intent on taking your money and leaving you homeless, would it have changed your mind?
Lenders have for years been able to sell loans below the real market price because the government has subsidzed their product through low interest rates and a de-facto nationalization of the mortage business through Fannie Mae and Freddie Mac.
Let Lenders suffer the natural consequences of underpricing their products. In the future accurate pricing of mortage products will make it much more difficult for individuals to get more credit than their income or prospects warrant.
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