Senator Takes On Bad Lending Practices
In an article by the Buffalo News, New York Sen. Charles E. Schumer denounces rogue lenders and "liar" loans, proposing national regulation of mortgage brokers and bans on some kinds of high risk loans. This is just the latest in a host of government legislators who are decrying many of the practices in the home mortgage market, particularly the subprime lending market.
"The subprime market is the wild west of mortgage loans, and it's time we bring a sheriff into town," said Schumer, who is chair of the Senate Housing and Transportation Subcommittee.
There is a proposal being floated by regulators that calls for a national registry of brokers. The National Association of Mortgage Brokers said such a proposal does not go far enough because it does not include all mortgage lenders. I'd have to agree.
Someone has to get the lenders operating in a more healthy way -- especially the subprime lenders. At Mortgage Guide 101, I'm still following the growing number of lenders that have either ceased to operate independently, have gone into bankruptcy or are shutdown. The Implode-O-Meter is my personal favourite for tracking the downfall of subprime lending; it has the number of lenders "kaput" at 44. This number only reflects lenders lost since December of 2006. So, while many still want to insist that there's no problem in the subprime lending market, I'd have to disagree.
There's serious problems still afoot.
Just this past week, I noticed that the stock price of a number of home builders are also on the slide. New home sales are down. The housing glut gets bigger and bigger.
Are you an investor who might like to pick up a few properties cheap? Pay attention to the foreclosure rates. With all these signs of a housing slow down, the prices will start to come down in many markets. Some regional markets may be able to hold on even while other areas slide, but the likelihood is that the national market will drop, at least somewhat.
As always, if you are looking for a mortgage, start with a few quotes. This site has sponsors that provide quotes and quote comparisons. It can help you with your legwork.